So you can get very remarkable investment results if you think more like a winning pari-mutuel player. Just think of it as a heavy odds against game full of craziness with an occasional mispriced something or other. And you’re probably not going to be smart enough to find thousands in a lifetime. And when you get a few, you really load up. It’s just that simple. –Charlie Munger
Dare to Be Great You have to weight your opportunities. Of course, how do you know when you have an exceptional opportunity? Experience and method. Joel Greenblatt was a master at position-sizing when he found low risk investments.
position_sizing (Academic paper)
Corsair Capital was down by about 3.5% net for the third quarter, bringing its year-to-date return to 13.3% net. Corsair Select lost 9.1% net, bringing its year-to-date performance to 15.3% net. The HFRI – EHI was down 0.5% for the third quarter but is up 11.5% year to date, while the S&P 500 returned 0.6% Read More
One secret: http://www.tradermike.net/2005/07/position_sizing/
Trembling with Greed http://www.fool.com/news/foth/2001/foth010213.htm
Trading Places (SELL!): http://youtu.be/1tmI867fAYU?t=1m55s Note the patience, patience and then ACT IMMEDIATELY IN SIZE.
Dare to be Great! Position-Sizing Via CSinvesting