Stocks

  • 05 Dec
    A Look At Opportunities In South America

    A Look At Opportunities In South America

    • Intensified selling is making emerging markets an interesting opportunity, will selling get to January levels?
    • Brazil has to be watched, of course, but Argentina has too much political risk for rational decisions to be made.
    • Chile is stable, but PE ratios are also much higher.

    Introduction

    After Trump was elected, many emerging markets were hit as a result of a growing negative sentiment toward their performance amidst tougher global trade.

    It’s great when prices go down as it allows you to buy stocks at better prices, if you don’t own too much of the stock, of course. The truth is that many businesses won’t be affected by Trump’s decisions, so it’s a good time to shop around.

    Today we’ll take a look at opportunities in South America. More →

  • 30 Nov
    Think You’re Comparing Apples To Apples? Think Again.

    Think You’re Comparing Apples To Apples? Think Again.

    • This article is a warning for novice investors and a reminder for experts.
    • When investing, nothing can be taken as a certainty as all are moving parts, especially financial metrics and prices.
    • Comparing current prices to past prices doesn’t help much, while understanding the fundamentals does.

    Introduction

    Investing shouldn’t be a comparative profession, but that is exactly what we do. We try to find the best stocks by comparing one to others, the best financial vehicle for our investments by comparing the options available, or we compare current prices with those of the past.

    Unfortunately, comparative analysis more often than not gives us poor risk-reward assessments. In this article, we’ll discuss the pitfalls of comparative investing and what can be done to avoid making unnecessary mistakes. More →

  • 23 Nov
    How To Make Activist Investors Work For You

    How To Make Activist Investors Work For You

    • We’ll analyze the scientific data that explains how activists effect returns.
    • Activism increases returns, but you can increase your returns without paying the 2/20 fees.
    • There is enough time from the first activist announcement to actual fundamentals improving to carefully analyze the investment and make an appropriate decision.

    Activist Investors

    Activists open a position in a company that is large enough to enable putting pressure on management, more often than not in a public way. They put pressure on management because they believe that the company is mismanaged and value can be unlocked through changes in corporate policies, acquisitions, divestments, better use of cash, larger dividends, cost-cutting, better financing options, etc. More →

  • 21 Nov
    Asymmetrical Risk Reward – What It Means For You

    Asymmetrical Risk Reward – What It Means For You

    • “The essence of portfolio management is the management of risks, not returns.” – Benjamin Graham
    • You should rethink your stocks and bond holdings as most have negative asymmetric risk reward.

    Introduction

    Asymmetrical risk reward is the essence of investing in stocks, and is also essential for those who want to beat the market.

    In today’s article, we’ll discuss what it is, what investment vehicle has the best asymmetrical risk reward opportunities, and how you can apply its benefits to your investments. More →

  • 09 Nov
    The Economics Are Great, But Valuations Point Toward Stock Picking To Limit Risk

    The Economics Are Great, But Valuations Point Toward Stock Picking To Limit Risk

    • GDP, productivity and earnings are growing which is great news.
    • However, valuations are high and interest rates are likely to rise soon.
    • Given the variations in revenue and earnings growth, and the upcoming changes in interest rates, now may be the time to switch from index investing to stock picking.

    Introduction

    As the earnings season is almost over—and GDP, productivity and labor data is in—it’s a good time to look at what kind of conclusions can be made out of the multitude of information. By putting the noise aside (the election) and focusing on news that impacts future earnings, we’ll relate recent developments to the potential risks and rewards for your portfolio. More →

  • 08 Nov
    It May Be Time To Switch From Discretionary To Staples

    It May Be Time To Switch From Discretionary To Staples

    • Consumer staples and discretionary stocks have similar valuations, but rising consumer debt suggests rebalancing towards staples is less risky.
    • Staples have better earnings to revenue growth which indicates higher competitiveness and M&A activity in the discretionary sector.
    • In the case of an economic pullback, discretionary stocks would be hit harder as M&A activity will prove too expensive at valuations above 24.

    Introduction

    With most of the earnings in and the S&P 500 down in the last two weeks, it’s good to take a look at the consumer goods sector to find potential defensive investments. The iShares Consumer Goods ETF (NYSEARCA: IYK) has enjoyed a wonderful run in the past 7 years. More →

  • 07 Nov
    Why You Should Be Holding Cash Now

    Why You Should Be Holding Cash Now

    • Beware of the financial industry pushing you to invest your cash. They are only doing so because they don’t earn a dime on it.
    • Market circumstances change, so what might be the best option now compared to other assets, might not be the best option in next five years.
    • Cash is a call option and before investing in anything, you should ask yourself what the risks are. Investing in stocks with a 50% potential decline around the corner for a 2% yield isn’t always the best idea.

    Introduction

    In an environment where everyone is looking to find the next best returns boosting investment, an asset that is rarely discussed and often taken for granted is cash.

    Today we’ll discuss the role cash should play in investors’ portfolios, the perspectives we have on cash, and finally, how much cash investors should have in relation to current market circumstances. More →

  • 24 Oct
    There’s Now A Millennial Index. Should You Invest?

    There’s Now A Millennial Index. Should You Invest?

    • A new millennial index has been created, the “Next 50.”
    • Valuations are extremely high, but the trends are all in favor of millennial companies.
    • We’ll provide a few investing strategies, so you can choose the best for you.

    Introduction

    Barron’s recently created an index of 50 stocks loved by young American consumers, the Next 50 index. Not surprisingly, there’s also an ETF that tracks millennial stocks, the Global X Millennial Thematic ETF, and we’ll likely soon see a new ETF that tracks the Next 50 index.

    Today we’ll discuss how much of the hype around millennial stocks is significant for long term positive investment returns, and why you should jump on the bandwagon. More →

  • 19 Oct
    Does That Company Have A Moat? You’ll Want To Find Out Before Buying Stock In It…

    Does That Company Have A Moat? You’ll Want To Find Out Before Buying Stock In It…

    • Moats are and will always be elusive as there is no computer algorithm or rule to help us in finding them.
    • Analysis of economies of scale, competition, and margins can help, but we’ll discuss some examples where common sense is what wins out.
    • Moats exist in the technology sector and aren’t that difficult to spot.

    Introduction 

    Warren Buffett’s most commonly referenced piece of advice is to buy a good business with a large moat at a fair price and hold it forever. This is easier said than done as in today’s complex world, moats become stronger and weaker at the same time. More →

  • 17 Oct
    Why A Market Crash Could Be Just Around The Corner

    Why A Market Crash Could Be Just Around The Corner

    • We’ll discuss some risks first and then discuss potential rewards.
    • Valuations are the tipping point toward a riskier perspective.
    • After reading this article you’ll be able to decide for yourself what the best strategy is for you to follow.

    Introduction

    In order to see where the market is going, let us first take a look at what the market has been doing in the last two years.

    The market has had a 7% yearly return if we look at it from October 15, 2014, however, if we wait a month, the yearly return for the last two years will fall to 1.8% per year. 1.8% a year plus a dividend yield of 2% isn’t bad in the current low yield environment, but it is bad when compared to the risks stock investors are running. More →

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