S&P Depository Receipts
A fairly common and rather tragic misnomer is that the stock market is rigged in favor of Wall Street executives and fat cats, the quintessential "1 percenters." Individual investors supposedly have no business trying to compete with the likes of Berkshire Hathaway's (NYSE: BRK-A) Warren Buffet, or George Soros, or Carl Ichan.
However, this misnomer mistakenly pits individual investors like you and me against the "big boys" on Wall more »
Near the end of a turbulent week Marc Faber, or Dr. Doom, made headlines when he predicted a sharp sell off in the second half of the year. In an interview after the market close on Thursday Faber announced to the public that he believes the U.S. stock market was drastically overvalued and due for a correction of at least 20% this year. Faber has long been famed for more »
If you’re not a professional investor you might find it difficult keep up with breaking news that would effect the stocks in your portfolio. Reading and interpreting financial statements, conference calls, economic indicators, is a lot of work. Successful investing is complicated and time consuming, but does it have to be?
Do you have what it takes
Even if you're a pro, it can become a life consuming more »
Although the domestic U.S.benchmark interest rates have risen quite a bit in the recent past (with the 10 year Treasury rates near the 2.50% mark) the search for yield is by no means over.
Apart from the paltry yield on fixed income securities, investors have had to seek solace in riskier investment avenues like high yield bonds, Master Limited Partnerships, Real Estate Investment Trusts and dividend paying more »
Warren Buffett’s minimalist personality is certainly represented in the way he reports financial results, and to be honest, it’s one of the greatest things about reading his quarterly reports.
How the company shaped up
Berkshire Hathaway reported earnings per share of $1.84 more »
Markets tend to be a little jittery when the FOMC (Federal Open Market Committee) makes a monetary policy announcement. Usually, it’s the least exciting topic to read about, so you’ll see various media syndicates write narratives on what’s going on. While it’s fun to write about airplanes flying out of the sky, and torpedoes landing all over the place, Ben Bernanke isn’t World War Z more »
Buying stocks at all-time highs almost sounds foolish, but it isn’t. The markets are structured very differently, and investors have to be on the cutting edge to take advantage of it.
Why investors should buy stocks
Source: Goldman Sachs
The general consensus is that economic growth should continue to pick up in the United States and in Europe. Also, the 10-year Treasury real interest rates (rates that include inflation more »
According to Mark Hulbert, investors collectively spend around $100 billion a year trying to beat the market. This includes fees charged by active mutual funds, hedge funds, and active ETF's. Unfortunately, for those investors, active funds have woefully underperformed the market.
Will German stocks outperform US stocks in 2013 as they did in 2012?A good case can be made that by the end of the year this will indeed be the case..or that German stocks outperform the US market for the remainder of 2013.
The modest correction in the U.S equity space is well and truly over. Although the recent sell-off caused the major equity indices to trade well and truly below their highs, yet the markets have recovered well and we have seen yet another full fledged reversal.
Although we have had a below par GDP revision, other aspects seem to be in place. Consumer confidence has been on the rise for more »
Patience is virtue. It is a state of being that is developed over time. Being a good investor is about more than finding a great company at a great price. If you don't have enough patience, your chance of earning a reasonable return is very small. Understanding a company's valuation and its prospects is important, but you need to be able to wait years for time to work more »
Part of the difficulty with analyzing equities is assessing the international strength of the economy. A strengthening dollar and falling emerging market GDP growth will have a negative impact on multinational companies.
Global economic backdrop
The iShares FTSE China ETF declined 22.61% year-to-date, iShares MSCI Brazil Capped ETF fell by 14.04% year-to-date, and the iShares MSCI Spain Capped Index Fund depreciated by 5.78% year-to-date.
Brazil more »
Is it time to chase stocks as they reach ever higher valuations? The stock market has reached new all-time highs, driven by stronger macroeconomic indicators paired with accommodative monetary policy.
The Federal Reserve bellwether
For the most part, investors are optimistic and are willing to chase the Dow Jones Industrial Average to record highs. The optimism in stocks is primarily driven by falling costs (process-driven improvements), favorable macroeconomic more »
I read two articles today, that were both stark reminders that most of us are really bad at investing. From Foolish contributor Morgan Housel:
Most investors underperform the market. When that's the case, how to become a great investor isn't what's important; becoming a less-bad investor should be the goal. The difference is subtle, but important.
The article goes on to list more detail about the common more »
One concept I have been examining lately is the idea that turning points in one market (the lead market) might forecast turning points in a secondary market. In this case, I am looking at if objectively defined turning points in bonds might lead the stock market. For this study I used ETF (SPY, TLT) data. By the way, If you have not read my article, “Using bond market data to more »
I don’t know about you, but I think we can all agree that gold has been an awful investment lately. It went from being coveted treasure to the atomic bomb. The gold community is busily debating over whether or not gold is over-valued, under-valued, a buy, or a sell, and etc.
The buy gold thesis
Buying free cash flow at a discount is a great way to find value. Below are three firms capable of producing free cash flow and are trading at low valuations. Still, free cash flow is not a silver bullet. Doing due diligence is very important to ensure that you are not buying a lemon where their earnings and free cash flows are behind them.
Try to imagine what the S&P 500 will look like in 20 years - not the price but its components. It's difficult to impossible.
As long-term investors we face the challenge of investing for a future of which we can't foresee. The tenet of long-term investing therefore isn't to predict those transformations but to find management teams and organizations that have proven themselves the most capable of more »
It almost never happens that both bonds and stocks take on a significant decline in valuation within a single session. Investors are currently fleeing into cash, and while it makes logical sense over the short-term, I maintain my optimism in equities over the long-term.
What is going on?
The market economy takes a lot of twists and turns. The FOMC's recent statement wasn't exactly the easiest bit of more »
Beating the market isn't easy, but one very simple strategy outperforms year after year. It has nothing to do with market timing or leverage, nor do investors need to actively hunt down stocks.
Most funds are market-cap weighted, so they own more of bigger companies than smaller companies. A small tweak to the weighting can have a pronounced effect on a fund's performance. Equal-weighted funds set all stocks more »
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