In today's market, many people are investing in IPO's of internet companies which have no sales or profits. That is a case of technical investors determining the value of a company's stock. Since 1995, people operating strictly as fundamental in- vestors have not done as well as investors who also consider the technical side of the market. In this wild market where the people who take the most risk win, people with more cau- tious and value oriented views lost out on this market mania. In fact, many of these risk takers frightened many technical in- vestors as well with their high prices of stock without any value. But in a crash, it is those investors with the strong fun- 250 Rich Dad's Guide to Investing damental investments and technical trading skills who do well. The amateur speculators rushing into the market as well as all the new start up IPOs flush with money will be hurt in the down turn. Rich dad said, "The trouble with getting rich quickly without a parachute is that you fall farther and faster. Lots of easy money makes people think they are financial ge- niuses when in fact, they become financial fools." Rich dad be- lieved that both technical as well as fundamental skills were important to survive the ups and downs of the world of investing. Charles Dow of Dow-Jones fame was a technical in- vestor. That is why The Wall Street Journal, the paper he helped found, is primarily a paper written for tech- nical investors, and not necessarily for fundamental investors. George Soros is often recognized as one of the best technical investors. The difference between the two investment styles is dra- matic. The fundamental investor analyzes the company from its financial statements to assess the company's strength and potential for future success. In addition, the fundamental in- vestor tracks the economy and the industry of the company. A technical investor invests from charts that track the price and volume trends and patterns of the company's stock. The technical investor may review the put/call ratio for the stock as well as the short positions taken in the stock. While both investors invest from the facts, they find their facts from dif- ferent sources of data. Also, both types of investors require different skills and different vocabulary. The frightening thing is that most of today's investors are investing without techni- cal or fundamental investor skills. In fact, I'll bet most new in- The Qualified Investor 251 vestors today do not know the difference between a funda- mental and technical investor. Rich dad used to say, "Qualified investors need to be well versed in both fundamental analysis as well as technical analy- sis. He would draw the following diagrams for me. These dia- grams are why we developed our products the way we did. We want people to be able to learn to be financially literate and to teach their children to be financially literate at a young age, as rich dad taught me.