Former janitor who lived modestly leaves $6 million to library, hospital
- Thread starter blakpacman
- Start date
These kinds of stories crack me up. The title implies that he became a multi-millionaire by being unusually frugal. As if. The real reason (great stock picking) is barely given half a sentence, because what else is the writer going to say? The old man's trading secrets? Of course not. So let's marvel at how he used safety pins when his buttons came off. LOL
he was not a great stock picker. he picked well know names and held for years. he had no trading secrets because he was an investor. he died at an opportune time for his heirs instead of in a bear markets 2000 or 2008.
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He was a great stock picker. You don't die a multi-millionaire by being a lousy or even a mediocre stock picker. Yes he was probably more investor than trader but let's not pretend like he just got lucky with his portfolio. He obviously knew what to do for the most part.
it is not obvious. a random porfolio chosen with darts will do well over a long period of time if the market has risen during that period of time.
If you compound a modest $5,000 over 60 years at 10%/yr, you will have 300x your money, or $1.5 million. He lived frugally and saved probably 30% of his income per year. I recall calculating that the "witch of wall street" Hettie Green made something like 20x her money in her lifetime when she died in 1916, though in her time the inflation rate was overall zero when the inflation was netted out with the deflation.
Twenty years ago another elderly lady, Anne Scheiber, who lived to age 91, left $22 million.
http://en.wikipedia.org/wiki/Anne_Scheiber
Twenty years ago another elderly lady, Anne Scheiber, who lived to age 91, left $22 million.
http://en.wikipedia.org/wiki/Anne_Scheiber
Yes but the Monkey or the Dart may not hold on after seeing nice gains. That's the hard part.
there is no hard part.
the same could be said for any portfolio.
.Buying a lottery ticket is the hard part, some people do infact make millions, playing the lottery. So when millions of people invest like a monkey, using darts etc, a few of them end up holding on, making money, alot of money.