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A Few Things About Value Investing
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Value investing is the act of investors selecting stocks based upon a perceived value rather than solely looking at pricing trends in the stocks history. |
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There are formulas for just about everything, but it has been shown that the simpler the formula or method of doing a particular task the better it works. It has evolved down to KISS – Keep It Simple Stupid. |
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You have heard about a particular mutual fund from a friend, saw it advertised on TV or read about it in some publication thought it would be a good buy. Next you call your broker to get his advice before you buy because he is an expert and is there to help you make money. |
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The fight continues to rage among traders who use technical indicators and those who prefer fundamental information to establish new positions and to exit current positions. |
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Parachute investing is buying an equity with a parachute so you wont risk all your money or, better yet, give back the profit you have made as the stock or fund went up and then goes down. |
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Stock trading is unlike any business in the world. It is not about work as such but about managing emotions and trading to a set method and being true to that method. Many people struggle here...professional money managers included. |
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We have all heard of the stock market and probably have a general idea of what it is and how it works either from high school economics classes, television financial reports, and the countless film depictions of what happens on the floor of the New York Stock Exchange. But how does it really work and what is meant by playing the stock market? |
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You have a lock on your house. You have a lock on your car. You have a lock on your tool shed. Do you have a lock to protect your stock market investments? |
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Sometime around 1980, can’t remember exactly, there was a flight of money from many countries to Switzerland. The clock makers had so much money pouring in that the banks took interest rates to zero and even for a period of time were actually making you pay ½% interest to them to put your money in their banks. Yes, it actually happened because people believed their money was going to be safe there. It was. |
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Robert Rodriguez likes to buy stocks at their lows. When there are not enough stocks hitting new lows, he closes his fund and piles up cash. This is what he has been doing lately. His moves deserve attention for good reasons, his $1.7 billion FPA Capital Fund has averaged an annual total return of more than 17% over the last 20 years, net of sales charge, handily beating all the benchmarks by wide margins. |
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