THINK LONG-TERM

Trying to time the stock market or risking it all to "double your money in a year" is at best speculating, at worst gambling. You may as well just take your money to Vegas and lose it there. Those who are able to successfully navigate the stock market are not speculators or gamblers, they are investors. Investors know they can beat the market because they think differently, they think smarter, and they think longer-term.

"Time horizon arbitrage" means that if investors learn to think long-term and can see beyond the daily and quarterly noise, they can gain a real upper hand. In 1964, American Express was a great company but the stock was getting hammered due to an insurance scandal. The company had to pay millions of dollars in fines due to accidentally underwriting barrels of vegetable oil that turned out to be water. That is exactly the time when Warren Buffett began purchasing the stock. The best investors look beyond short term distress and keep their eyes on the long-term horizon.