It is said that to succeed in investing, one only needs to make the right investment calls more than half the time (>50%). Fortunately or unfortunately, this can be a very misleading statement.

Battling Average

The idea behind it is a simple one. The number of times that you are right divided by the total number of investments that you make is called the battling average. The term battling average is rooted in baseball and refers to the total number of hits divided by the total number of At Bats. With a battling average of more than 50%, you can simplistically expect to make positive returns in the long run. However, this may not necessarily be the case…

Slugging Percentage

The reason is that you make lose more on your losers than you make on your winners. This is what the slugging percentage accounts for. Slugging percentage is also rooted in ...