July 29, 2008
– Comments (1)
Mechanical, or statistical, investing has many inherent advantages against traditional research and opinion based stock investing. Here are the top 5 reasons to follow a mechanical strategy.
I'm not sure I agree with some of those points. I find I'm more emotional attempting to use "mechanical investing" since I have little knowledge of the company's underlying fundamentals, and hence, less confidence in a pick.
If I read through the financials, do some research, and do a bit of work on the IS, BS, and Statement of CFs, I tend to have much more confidence and pay very little attention to short-term swings.
Of course, there is something to be said for making a good return with minimal time and effort.