Stocks

  • 09 Mar
    Want To Get The Best U.S. Companies At 50% Off? You Might Get That Chance Soon

    Want To Get The Best U.S. Companies At 50% Off? You Might Get That Chance Soon

    • A look at the DJIA from a valuation perspective will give us a good indication of future returns.
    • I’ll also give a cyclical perspective on stocks by looking at their CAPE ratios.
    • As well as explain how valuations usually contract and expand alongside earnings.



    Introduction

    Two days ago, I discussed how valuations may be the biggest risk to stocks at this moment. Building on that, I want to go through the Dow Jones Industrial Average (DJIA) and discuss the valuations there.

    The DJIA, unlike the S&P 500, is an arithmetic average weighted index and it is far less industrial than it was when it was formed in 1885. Nevertheless, it still gives a good impression of how the American economy is doing.

    What I want to build on are valuations.

    More →

  • 07 Mar
    Risks Are Piling Up – That’s A Huge Red Flag For Stocks

    Risks Are Piling Up – That’s A Huge Red Flag For Stocks

    Last week I discussed how the risk are piling up on the debt side of the equation. However, those aren’t the only risks piling up which isn’t uncommon for humans. When we stray, we usually stray in a big way.

    So, on top of the debt, there are other huge risks and today the discussion will be about valuations:

    • Debt is being used recklessly.
    • Valuations don’t matter as growth is the key and profitability will come.
    • Book values are so old fashioned.
    • Stocks can only go up and corrections and bear markets don’t last long.
    • Real estate can only go up.
    • If you invest in index funds, you will do well.



    Now, I’ll discuss a lot of macro, and even some politics on Monday, but such factors might be insignificant or very significant depending on market valuations. High market valuations make stocks fragile, while low valuations make them more robust as once stocks are low, there is little room to go lower. However, when stocks are high, a lot of bad things can happen. The sad thing is that we have been there and we are doing the same mistakes all over again.  More →

  • 06 Mar
    Tariffs & Interest Rate Hikes – Does This Mean Doom & Gloom For Stocks?

    Tariffs & Interest Rate Hikes – Does This Mean Doom & Gloom For Stocks?

    • Last week was an eventful week for stocks. Today, we’ll discuss the long term impact of what has been going on.



    Introduction

    So last week was another down week for the S&P 500 and from what’s going on, it looks like it’s something we should get accustomed to. More →

  • 05 Mar
    Stocks Are Crazy Risky Now – We’ll Reveal The Perfect Hedge

    Stocks Are Crazy Risky Now – We’ll Reveal The Perfect Hedge

    There’s some volatility in the markets that we haven’t seen for a long time.

    The increased volatility is a sign of nervousness and the market is looking for direction.

    No one knows where things will go in the short term as that’s impossible to know. Even Warren Buffett never fails to mention how he has absolutely no idea about where markets will go in the short to medium term.

    If we look at things from a macro perspective, the economy is at its limits and we’ve seen the actual GDP finally reach the potential GDP. More →

  • 26 Feb
    Let’s Talk Inflation & Interest Rates

    Let’s Talk Inflation & Interest Rates

    • The fight between interest rates and stock valuations has started.
    • The only smart thing to do now is to take a long-term perspective and estimate what financial markets will look like in two years. Few think that way.
    • Corporate profits in relation to GDP tell you what will happen in the long term.



    Introduction

    Last Wednesday, the FED released the minutes from its latest meeting. Soon after the minutes were published, the market went into reversal mode. More →

  • 20 Feb
    Here’s What You Need To Know About Inflation & Stocks

    Here’s What You Need To Know About Inflation & Stocks

    • There are three scenarios when it comes to stocks and inflation.
    • The only thing you can do is be prepared and avoid risky things.



    Introduction

    Last week’s key number to watch was inflation which surprised on the upside – higher inflation should lead to higher interest rates but the FED might let inflation run a bit in order not to hit the brakes too hard. However, the markets didn’t react, everybody was buying the dip as the salespeople—sorry big banks—came out with statements that it’s all fine. More →

  • 15 Feb
    The Stock Market Crash Hedge You Need Now

    The Stock Market Crash Hedge You Need Now

    • I’ll explain how the key hedge for the retail investor is the cash component.
    • Further, we’ll discuss how much cash one should have now, and there is a method. In the end, it depends on one’s age.
    • Forget about options and derivatives as they are extremely sophisticated strategies for retail investors.



    Introduction

    Volatility has really spiked in the last few weeks and the stock market is in correction territory. The main question everybody would like to know the answer to is whether this slump will continue.

    Of course, even if fundamental indicators have been showing the market is overvalued for quite a while now, you can’t precisely know what will happen.  However, the market isn’t risky because of volatility, it’s risky due to extremely high valuations and rising interest rates. More →

  • 12 Feb
    This Is What’s Going On In The Stock Market & What Will Happen Next

    This Is What’s Going On In The Stock Market & What Will Happen Next

    • I’ll tell you exactly what you need to know to make investing decisions now.
    • The key things to watch are yields, both from stocks and Treasuries.
    • No matter where you are, the long term picture makes decision making pretty easy.



    Introduction

    Stocks were down 5% at the beginning of last week which is good news for all of us who keep adding money to our portfolios. It’s not such good news for those who need to sell stocks or need money soon. More →

  • 08 Feb
    It May Hurt To See Stocks Decline, But Here’s Why It’s Good For You

    It May Hurt To See Stocks Decline, But Here’s Why It’s Good For You

    • The lower stocks go, the richer you will be. Sound crazy? I’ll show you how it works.
    • There is no trick, you just do what you would do anyway and end up richer even if you have $500k in stocks now.
    • I’ll end on a personal note about how I’ve made most of my investment returns after terrible market crashes.



    Introduction

    A real investor is one who is happy when stock prices fall. Let me ask you a few questions borrowed from Buffett: More →

  • 15 Jan
    The “Sleep Well At Night” Investing Strategy

    The “Sleep Well At Night” Investing Strategy

    • Investing is personal and should be more about sleeping well at night than returns.
    • I hope you sleep well at night because you are well prepared for what might happen and not because you don’t know the risks.
    • Unfortunately, sleeping well will always come at a short term cost but I think it’s well worth it.



    Introduction

    Two and a half years ago, I took out a mortgage with a fixed interest rate (3.55%) even though my friend from the Dutch National Bank was telling me to take the lower variable interest rate (2.5%) because the probability that interest rates would rise was very small and I could always change the variable rate to a fixed rate if necessary. More →

1 2 3 4 5 11