Investing Strategy

  • 21 Oct
    Passive or Active Funds? Neither… Sven Has A Better Option For You

    Passive or Active Funds? Neither… Sven Has A Better Option For You

    Whenever you find yourself on the side of the majority, it is time to pause and reflect. – Mark Twain.

    • The biggest market risk comes from money flows. Everything is good while more money is being invested, but withdrawals will create forced asset sales and another bear market.
    • In the last 10 years, 27% of actively managed funds have outperformed the market, but you can increase your chances by choosing a third option.

    Introduction

    In the everlasting debate between passive and active investing, passive investing is currently winning. More money is flowing into passive than actively invested funds, and many celebrate victory and the death of stock pickers. Stock market movements are influenced by money flows and if more money flows into passive funds, they will clearly outperform the competition.

    In today’s article, we’ll take a look at what is going on in the world of actively and passively managed funds, and will discuss a third option. An option that’s cheaper and one where your returns don’t depend on money market flows all that much. More →

  • 18 Oct
    Investing Advice From John Maynard Keynes

    Investing Advice From John Maynard Keynes

    • It’s good to invest for the long run, but don’t let that be an excuse for investing in overvalued stocks as in the long run, we all die.
    • Often shunned as irrelevant, inflation must be considered when investing.
    • Markets are irrational and get more irrational as people think less. ETFs are the perfect example.

    Introduction

    You probably remember Keynes from Economics 101 as his ideas fundamentally changed the way people looked at economics in the first part of the 20th century. Before Keynes, a laissez-faire (let people do as they choose) economy with low or no government involvement, was the norm.

    By studying the causes of business cycles, Keynes came to the conclusion that government intervention is necessary to moderate boom and bust cycles in an economy. He endorsed the New Deal in a letter to President Franklin D. Roosevelt in 1933, and the New Deal remains a perfect example of his theories. More →

  • 11 Oct
    Under 30? How To Invest Now For Incredible Future Returns

    Under 30? How To Invest Now For Incredible Future Returns

    • This post is essential reading for young investors, while also valuable for investors of any age. If you’re a more mature investor, pass this along to your kids or grandchildren.
    • Investing regularly month after month is going to get you a long way.
    • The younger you start, the better. As life expectancy is getting longer and longer, if you are under 50, you can still grasp the benefits of investing in stocks for the long term.
    • As the current market looks overvalued, don’t be afraid to start dollar cost averaging. Follow along with Investiv Daily for great investment choices.

    Introduction

    An essential concept in investing often shunned by mainstream media is connecting your investment strategy with your specific goals. The majority of the content we see is about one investment type, i.e. stocks, bonds, gold or real estate.

    All investment tools have their pros and cons which are emphasized when we specify the age and goal of the investor. Today we’ll discuss why investing in stocks is essential for young investors, and a low risk way for doing so. More →

  • 09 Oct
    Sunday Edition: The Most Important Pattern In A Bear Market Bottom

    Sunday Edition: The Most Important Pattern In A Bear Market Bottom

    Over the last several months we’ve focused on sharing with you several of the fundamental metrics Thomas Moore uses to identify deeply undervalued companies on which to sell put options to generate income. We hope they’ve been beneficial.

    In today’s Sunday Edition I’m certain to draw a lot of skepticism from those “purists” who believe that markets are both efficient and driven exclusively by the fundamentals.

    On the other hand, if you believe that markets are not only irrational but are driven by psychology and what some like to refer to as “animal spirits,”  then you might appreciate what I share over the next several weeks in these Sunday Editions. More →

  • 06 Oct
    Is Your Brain Wired For Investing?

    Is Your Brain Wired For Investing?

    • Recency bias, probability neglect and aversion loss are just a few of the concepts that we, as humans, find difficult to avoid in our investing.
    • The average U.S. investor underperformed the market by 7.4% per year in the last 30 years as a result of taking action under the influence of emotions.
    • Fundamentals, valuations and dollar cost averaging can help you put your emotions aside.

    Introduction

    Today we’ll discuss how humans aren’t really mentally prepared for investing. We are wired to survive in the woods with a freeze, fight or flight system, which has nothing do to with the markets. There is no threat of death when it comes to investing in the markets. More →

  • 02 Oct
    Sunday Edition: Diversification or Accumulation?

    Sunday Edition: Diversification or Accumulation?

    Joel Greenblatt, in my opinion, is one of the greatest value investors of all time. 

    One thing that sets him apart from many other investors is his willingness to concentrate on a handful of deeply undervalued companies rather than diminish his returns through over diversification, or as Warren Buffett once said “diworsification.

    So how many stocks is the right amount to own to be diversified enough, yet not diminish your potential returns? More →

  • 25 Sep
    Sunday Edition: Why Assignments From Put Sales Enhance Income Generation

    Sunday Edition: Why Assignments From Put Sales Enhance Income Generation

    I have wanted to write this for quite some time because it needs to be said. I’m sure I will piss off a few people but I can live with that if a few others grasp the wealth building concept I’m trying to make.

    A little over two years ago we launched our Rebel Income newsletter with a focus on income generation by selling put options, collecting dividends, and writing covered calls.

    The impetus behind launching this service was the current retirement crisis where most retirees have severely underfunded retirement accounts—the average account balance of those between the age of 55-64 is $104,000—and we live in a world of negative interest rates. More →

  • 18 Sep
    Sunday Edition: Stock Dividends – IRS-Friendly Sacred Cow, or Value Analysis Tool?

    Sunday Edition: Stock Dividends – IRS-Friendly Sacred Cow, or Value Analysis Tool?

    In today’s Sunday Edition, Thomas Moore corrects three major fallacies which so many investors hold true when it comes to investing in dividend paying stocks.

    As Thomas illustrates, investors who succumb to these fallacies might only earn half the return that other more informed value investors might generate. More →

  • 14 Sep
    Diversify Like The Big Boys Do

    Diversify Like The Big Boys Do

    • Temporal diversification diversifies your portfolio through time by buying only the assets that are cheap at the moment and avoiding the ones in a bubble.
    • By buying in cycle troughs you enjoy high-dividend yields that allow you to buy other assets that are in temporal distress.
    • This high yield lowers the need to sell and lowers your tax bill.

    Introduction

    Today we’ll introduce you to a new concept—“temporal diversification,” a term that has begun to gain traction, especially in academic circles—that isn’t yet common knowledge but is already being used by the best investors. Using the example of Berkshire Hathaway, we’ll provide an overview of the concept of temporal diversification and will provide some ideas for increasing your returns by diversifying your portfolio not just for the current moment, but for your whole investing life. More →

  • 13 Sep
    What To Expect From The Markets Now

    What To Expect From The Markets Now

    • The German bond’s 3% loss on a 12 basis point yield move shows how risky bonds are right now.
    • The value of the S&P 500 should be around 1,600 but could go lower with bad economic news.
    • Bonds and stocks seem very risky as they both have low yields and large downsides.

    Introduction

    Last Friday was a pretty scary day in the financial markets. The S&P 500 lost 2.45% and bonds also lost ground due to higher yields.

    Stocks and bonds are correlated and don’t provide quality diversification. We have been warning about the risks inherent to bond investing for a while with warnings that the low yields mean high risk and low returns. More →

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