It has always amazed me that the stock market and horse racing have so much in common. They both require a certain understanding of the rules and success usually comes to those who follow a specific discipline. I guess you could say that Warren Buffett is the ultimate handicapper. He weighs a number of factors before making a bet on Wall Street. Yet, he is quick to point out that picking good stocks is not exactly rocket science.
Rationality is essential.
Selection at the track is equally important. Over the years I have watched racetrack professionals make their horse selections. The long-term winners will go races, many times days, without putting down a bet. They only enter the game when the odds appear to be clearly in their favor. Buffett will tell you today that it is probably prudent to sit out the betting on Wall Street.