Why it pays to be a swing trader.....not a position investor

 
I always approach my trading as a swing trader; not a position investor. For me, preservation of capital rules above all else.

To illustrate the dangers of position (long-term buy-and-hold) investing, I read today that Anthony Bolton, the famed Fidelity fund manager, has managed to lose over 24% in his China fund in the past year.

I don’t know about you, but this type of investing just doesn’t appeal to me. It is all very well saying – or more honestly, praying – that it will do well in the future. But that smacks of rationalisation to save face. 

In truth, no-one knows what a fund – or any financial market – will do in the future with anything approaching certainty. It could go down 50% or more. It could double.

My point is that a loss is a loss, and any investor who puts their faith – and it is faith – in a star manager, is in a state of denial when faced with this reality.