Carl Futia on Speculation

In the archives I found this interesting column by Carl Futia (article) from 2005.
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Sad to say, intelligence has little to do with success in speculation ...

What is really needed for successful speculation is not intelligence but what speculators call an "edge". An edge is a piece of knowledge or a reliable instinct which predicts the direction of market prices and that is not shared by too many other speculators.

You can't get an edge by reading the finance or technical analysis books you bought on Amazon or at Barnes and Noble. The information they contain is fine as far as it goes, but the trouble is that it is information that everone else has too! It can't give you an edge on other speculators. For the same reason you can't get an edge by attending a seminar that promises to reveal market secrets which will lead you to wealth.
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Sometimes friends or acquaintances tell me they have signed up for or already taken a seminar or class or bought some whiz bang software. For the reasons stated so clearly above, it rarely works. What I tell everyone is that there are a 1000 ways to make money, a 1000 different approaches to the markets. Find the one, two or five that work for you and fit your personality. Something that works for me, may not work for the next person because of their temperament and inclinations. Mechanical systems need to be adaptive, because there are now so many formula spinners testing their trading systems night and day.

It is the weekend so I will ramble on a bit. Investing is different from speculating. For the average person, diversifying into age appropriate asset classes, and dollar cost averaging will out do most would be speculators. Same when getting out, get out a little bit at a time. Making big bets is entertaining and exciting, but few folks continually take big risks and win enough to offset the losses. Readers know that my style is to cut losses, and hedge to limit risks. Again, with spring training upon us, the analogy is a singles hitter in baseball vs. the home run hitter that strikes out a lot. Both styles can be successful, a lot depends on personality and execution.