Invest Like a Shark | stockbee

12/14/2007

Invest Like a Shark

Invest Like a Shark: How a Deaf Guy with No Job and Limited Capital Made a Fortune Investing in the Stock Market (Hardcover)
by James "RevShark" DePorre (Author), James J. Cramer (Foreword)

This shark is afraid of depth. Very afraid of depth. So James 'RevShark' DePorre swims in 6 inch deep water in this 200 page book. Superficial treatment of investing with capital S is what this book is all about.

In its subtitle the book promises to tell you , How a deaf guy with no job and limited capital made a fortune investing in the stock market. That story is known to most readers of thestreet.com. That story is 7 pages in the book, rest of the book is superficial fluff and mostly a long harangue about how Wall Street is out to get the small guy. The authors prescription to average investors to overcome that problem is to become a active trader.

The author calls this new approach Shark Investing. Now how does RevShark define shark investing, well tough luck finding that in this book. What you will find is general, non specific homilies like shark investors are aggressive, they are flexible, they are fast and so on and so on without getting in to details.
Consider these characteristic of Shark Investor the author highlights:
  • sharks are aggressive
  • sharks are opportunistic and reactive
  • sharks stay in motion
  • sharks plan their attacks
  • sharks are patient while they stalk their prey
  • sharks take advantage of emotions of crowd
  • sharks don't have emotional or sentimental attachments
  • shark are risk averse
  • sharks have an attitude
  • sharks hate deep water!! (I made that up)

Rhetorical flourish and flowery language is used all the time to avoid getting in to depth. Throughout this book this shark skillfully avoids getting in to deep waters. So all other approach to investing are dismissed as not suitable without providing any valid proof or coherent arguments. Value investing is dismissed as buy and hold, which shows utter lack of understanding by the author about what value investing is. Academic research is dismissed as just efficient market hypothesis . Obviously in the shallow waters this shark swims in he has never heard of things like PEADs and momentum anomalies and several other anomalies which challenged efficient market hypothesis immediately.

The funny part is after dismissing academic research as not useful to investors the author gives two examples of Shark style trading PCR and GROW, both are examples of post earnings announcement drifts, where those stocks broke out post significantly better earnings. PEAD is well documented anomaly in academic literature.

Overall in this book, there are no specific and just general superficial direction. The shark metaphor is overused, so it becomes irritating. As a trader I doubt you would find anything useful or containing any depth in this book.

As an investor you should stay away from this Shark. Why because it gives the wrong advise to investors who neither have the skills nor the tools to become active traders. The author keeps stating again and again that for average investor active investing in which you stay in motion, is a far safer approach to the stock market than the long term "buy and hold" approach that Wall Street promotes. He neither defines what it is nor shows the average investor how to do it. Without in depth understanding of what is involved in active investing, if average investors try it, the other sharper sharks will eat them alive in the market.

RevShark might know how to trade, but he does not know how to write a useful book with meaningful advise for traders or investors. This book looks like a half hearted, hurriedly put together book.

7 comments:

Bill aka NO DooDahs! said...

Yeah, there's a lot of crap written by traders (ostensibly) for traders. The book you reference is in line with most articles and books I've read on trading. See my review of Alan Farley's article
http://www.billakanodoodahs.com/2007/12/ten-ways-to-improve-your-market-timing/
it is basically the same.

The most popular websites are similar in terms of garbage content, as well.

It seems the consumer marketplace for trading information is decidedly skewed towards bullshit over content.

David said...

Is this guy the same Rev Shark that has a chat room and charges a gazzilion $ per month to watch his greatness?

Russell said...

Thanks Pradeep.

I was seriously thinking of ordering the book but your opinion changed my mind. There are many books to choose from and a review from a smart guy like you is appreciated. Did you review Dick Davis's new book or Jim Rogers new book yet?

To RevShark, sorry!

Pradeep Bonde said...

Dick Davis book I am reading currently. It is interesting panoramic view of market, market participants and newsletters.

john said...

I agree....very disappointed after review the book at library.

If you look at the stocks he recommends for his model portfolio, they fall into three broad themes:

1. buying post EP breakouts after some consolidation (say 10% retracement/high pennant flags)

2. buying post EP breakouts after big retracement (say 30%)

3. IBD's canslim type stocks.

I was expecting his book to show specific screens/etc. Alas, no.

Happy that I didn't buy the book

Pradeep Bonde said...

I seriously wonder who are the people who are writing those glowing reviews on Amazon for the book.

Mike said...

Those people writing reviews on Amazon might happen to be some friends of mine.

One of whom started with 2 grand in Scottrade and paid his way through college (private school 40k/year) and just bought himself a brand new Jeep.

I know the book hasn't been out that terribly long, but those I'm referring to have been following Deporre online for a while now.