Stocks

  • 18 Oct
    On The 30th Anniversary Of 1987’s Black Monday, Today’s Market Looks Eerily Similar. Should You Prepare For A Crash?

    On The 30th Anniversary Of 1987’s Black Monday, Today’s Market Looks Eerily Similar. Should You Prepare For A Crash?

    • The data indicates that the likelihood of a crash similar to October 1987 is the same today as it was then.
    • This doesn’t mean the stock market will crash tomorrow.
    • It only means that you should know yourself extremely well and relate your investments to your risk reward appetite. Only this can prevent you from the biggest mistake investors usually make, i.e. sell at the bottom of a bear market in total panic and capitulation.



    Introduction

    On Monday October 19, 1987, the stock market crashed a whopping 22.6% in one day. Is it possible that the same could happen tomorrow? Well, let’s compare the current market and to the one back then. More →

  • 16 Oct
    Doing This Could Increase Your Returns By $2.6 Million

    Doing This Could Increase Your Returns By $2.6 Million

    • It’s somehow accepted that stock returns have been between 8% and 10% in the past. That is correct, but only for a short period in history and it’s not true for all markets.
    • We’ll discuss stock returns over the past 100 years globally which will paint a different picture than what the predominant opinion would have you believe.
    • This doesn’t mean stocks are bad investments, you just have to understand how to go about them. After all, it’s your financial life on the line.



    Introduction

    Currently, most financial advisors will state that the best rational investing pattern is to invest in index funds as it’s impossible to beat the market, and that index funds have been a great investment vehicle over time.

    That would be a correct statement, but the returns that are noted by those who are trying to sell you an index fund are cherry-picked from historical examples. But the truth looks a little different. More →

  • 10 Oct
    7 Rules For Finding Stocks That Will Double

    7 Rules For Finding Stocks That Will Double

    • I’ll describe 6 stocks that have recently doubled that give us good guidelines on finding the next stock that will double.
    • If you do the research, it isn’t that tough to find stocks that will double or more. Perhaps the reason we don’t always find them is our psychology, predictably.
    • The analyzed stocks include a miner, a wealth management company, a social media company, an education company, a paper company, and a big pharmaceutical.



    Introduction

    I wrote an article not too long ago about where and how to find stocks that will potentially double or even become multi-baggers, and described a few sectors to look at to find these stocks.

    In today’s article, I want to dig a bit deeper and show you what should you look for in a specific stock that can indicate multi-bagger potential or at least a 50% return in a year, as Buffett used to do when he was younger. More →

  • 22 Sep
    This Is Why A Market Crash Is Good For You

    This Is Why A Market Crash Is Good For You

    • It might sound counterintuitive, but high stock prices aren’t that great for the majority of investors.
    • If you take the perspective that looks at long term returns and actual business ownership, your future income would be much higher now if the S&P 500 had stayed at 1,000 points for the past 10 years.
    • Don’t think stock markets only go up, look to Japan to be reminded of that.

    Introduction

    Everybody is so afraid of a stock market crash and here I am talking about how it can be good for you.

    As much as it sounds counterintuitive, a high stock market isn’t good for long term investors. The ultimate goal every investor should have is to accumulate as much ownership as possible, not to gain temporary value. More →

  • 04 Sep
    Is It Possible To Time The Market?

    Is It Possible To Time The Market?

    • Accurate market timing would lead to amazing returns, however it’s extremely difficult to actually time the market. I’ll show why.
    • As market timing is difficult, I’ll also show what you can do that will allow you to lower your risk and increase your returns.
    • Focusing on long term underlying earnings will allow you to outperform the market and significantly outperform the average investor.

    Introduction

    The question many investors ask themselves is should they try to time the market.

    This is especially important now that many, including myself, keep shouting about how the market is overvalued.

    I have also discussed scenarios that imply a 70% downside for the S&P 500. Therefore, I understand your concern and I’ll try to provide a valuable answer to the question of market timing in this article. More →

  • 21 Aug
    Real Estate Vs. Stocks – What Sven Says Makes The Better Investment Today

    Real Estate Vs. Stocks – What Sven Says Makes The Better Investment Today

    • As investors, we must be primarily concerned about risk and return, not asset class.

    Introduction

    I often get a question from people that have a decent amount of money about where to put that money as they know I specialize in investing, and especially the stock market.

    They’re often surprised when I tell them to invest in real estate and to leave the stock market to those who can take advantage of the volatility and greater risks especially now that stock valuations are extremely high, or to do both as an excellent diversification strategy. More →

  • 16 Aug
    Why You Need To Prepare For All Hell To Break Loose

    Why You Need To Prepare For All Hell To Break Loose

    • The last stock bull market was influenced by central bank activity, that’s clear. What’s next is the question.
    • I’ll describe three potential scenarios that could impact our financial system.
    • One is good, the second is interesting, while the third is ugly.

    Introduction

    The general expectation is that the FED will start selling securities in order to tighten monetary policy, that the ECB will slowly stop buying, and that nothing will change in Japan. Nevertheless, such a situation would lead to an environment where the additional liquidity created by central banks finally dries up. As the liquidity provided by central banks is the main reason behind this bull market, should investors begin to cut their positions?

    In order to elaborate on this question, we’ll first analyze the situation, the expected situation, and then possible scenarios in order to give you the best answer on how to prepare yourself for what might happen. It’s extremely important to do so and, as you will see, it isn’t that difficult. More →

  • 15 Aug
    Is It Possible To Find A Wonderful Business At a Fair Price In Today’s Environment?

    Is It Possible To Find A Wonderful Business At a Fair Price In Today’s Environment?

    • We’ll first define what a wonderful business should be and what a fair price would be in relation to general stock market risk.
    • We’ll look at price earnings differences among sectors and countries to find places to look for great investments.
    • A list of S&P 500 companies with low P/E ratios shows that it isn’t easy to find wonderful businesses at a fair price.

    Introduction

    Warren Buffett’s main advice to investors is to find a wonderful business at a fair price. Now with the S&P 500 price to earnings (P/E) ratio of 24.34, that implies an earnings yield of just 4.1% which makes me ask myself, is it possible to find a wonderful business at a fair price today?

    I’ll first describe what a wonderful business is, look at what would be a fair price for it, and then look to see if there are any such businesses around. More →

  • 10 Aug
    The Hardest Part Of Investing & How To Do It Right

    The Hardest Part Of Investing & How To Do It Right

    • Deciding when to sell a stock is the most difficult decision in investing. It’s much more difficult than deciding when to buy.
    • I’ll discuss 5 strategies that can go a long way toward helping you in making the difficult decision.

    Introduction

    The vast majority of the discussion around stocks is about what and when to buy. However, what’s even more important than buying is when to sell.

    Knowing when to sell allows you to lock your gains in when you are right, limit your losses when you are wrong, and, most importantly, avoid selling for a small gain when the stock has the potential to double or more. More →

  • 04 Aug
    Think The Biggest Companies Of The S&P 500 Will Outperform? History Says Otherwise

    Think The Biggest Companies Of The S&P 500 Will Outperform? History Says Otherwise

    • The strongest companies in the S&P 500 may look invincible now, but history shows us this won’t last forever.
    • None of the companies in the S&P 500’s 1980 top 10 are still there now.
    • Top 10 S&P 500 companies largely underperform the S&P 500 in the long term.

    Introduction

    Apple (NASDAQ: AAPL), Microsoft (NASDAQ: MSFT), Amazon (NASDAQ: AMZN), and Johnson & Johnson (NYSE: JNJ) are the 5 largest holdings of the S&P 500 accounting for 11.74% of the index. The other 495 companies account for 88.26% of the S&P 500 which is a pretty strong imbalance, but that’s how the S&P 500 is formed. Its weightings are based on market capitalization. The bigger the market capitalization, the bigger the weighting in the index. More →

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