#TBT: How to Invest Like a Billionaire
No, that title is not a joke in the least!
You do not need to be a billionaire in order to invest like one; just like you don't need to have a million bucks in order to look like you do. How is it possible? Obviously you do not need to buy the exact same number of shares as a billionaire would, but it is important to pay attention to where the rich folks are putting their money.
Did you know that billionaires who own a voting stake in a company are required by law to disclose their trading activities? Good news for you! This means you can almost be that guy who looks over the shoulder of the pros for some good ideas.
Not long ago, I wrote about the importance of Activist Investors as a method to change the course of the economy and the sustainability of the globe. While you may not agree with the philosophies of the companies they invest in, you can always gain the upper edge of understanding how and why they put their money behind particular companies.
One of the coolest ways to learn how to invest like Warren Buffet or Carl Icahn is to download the iBillionaire app - which allows to pick and choose which billionaires you'd like to follow and for you to see exactly what stocks they are holding in their portfolios at any given time. Pretty cool huh?
Billionaires typically engage in a near-to-long term investing strategy and don't trade high volumes over a short period of time like a day-trader would. Since there is a great need to regulate such massive trades, they generally take place over a few days to avoid any artificial inflation of the stock prices.
Keep in mind that while some investments look like good ideas because some rich guy is buying it, sometimes they just don't fully understand what the company is or does. I feel this way with Icahn buying so many shares of Herbalife - a company that while on the surface may be helping people lose weight and stay healthy, is just another weight-loss company. Does it have quality long-term growth? I just don't see it.
As I mention to all my clients time and time again - never think that the people on TV or that billionaires know everything. They don't. Take what they say as opinions to factor into your final decision, but never blindly follow the experts - that is a dangerous strategy, and won't get you to the "billionaire" status.