Investing - The Basics 02 (Jul 16 - Dec 27)

[behappyalways]

New Study Finds CFA Charterholders Are Actually Worse At Investing
https://www.zerohedge.com/markets/new-s ... -investing

[behappyalways]

We Are All Traders Now
https://www.zerohedge.com/markets/we-ar ... raders-now

[behappyalways]

Here Are Some Things That Are True...
https://www.zerohedge.com/markets/here- ... s-are-true

[winston]

World-class business has four critical traits

by Eric Fry

1. Forever Stocks possess an impregnable competitive advantage over their competitors — a “moat.”

2. Their competitive advantage shows itself through rising revenue and cash flow. (Earnings should be rising as well. But accounting gimmickry can easily manipulate profits, so I generally ignore reported earnings and focus mostly on revenue and cash flow.)

3. They use cash flow to enrich shareholders, through rising dividend payouts, share buybacks, astute acquisitions… or a combination of all three.

4. They maintain a healthy balance sheet in order to preserve their financial flexibility and resilience.

Source: Smart Money

[behappyalways]

The True Reason Why Central Banks Do QE

Source: The Macro Compass

https://themacrocompass.substack.com/p/ ... qe#details

[winston]

Don’t Make This Newbie Investor Mistake

by Dr. David Eifrig

Thrift Shop Fallacy – when investors are irrationally attracted to stocks with lower share prices over stocks with higher share prices.

Source: Daily Wealth

https://dailytradealert.com/2022/07/14/ ... r-mistake/

[winston]

The 5 Things You Need to Know Before Buying Any Stock

by Shah Gilani

Because most people plan on buying stocks as long-term investments, the order of importance of the five things you have to have should be:

1. The company must have products or services that can fill a gigantic addressable market and be the best or among the best at it… or be a disruptor on their way to changing the space.

2. Revenue, profit margins, and profits – what analysts call “earnings,” in sum. They matter.

3. Capital structure matters a lot more than most people think, because there are critical clues to a company’s prospects in its capital structure.

4. Intrinsic value, which is an assessment of a company or its stock in terms of traders’ and investors’ perception of the company and its prospects. Narratives relating to the company, and behavioral investing factors that stem from an assessment of intrinsic value (as opposed to market value) are akin to a secret sauce that if present (or better yet, persistent) can catapult a stock.

5. The picture of investor psychology manifested through price action, captured in charts, has to be corroborative.

Source: Total Wealth

https://dailytradealert.com/2023/05/29/ ... any-stock/

[winston]

Guidelines for investing in the stock market

by Koon Yew Yin


Stock selection criteria
Among all the stock selection criteria such as NTA, dividend yield, cash flow, debt or cash rich, etc, the most powerful catalyst to push up share price is profit growth.
To be safe, only buy when the company has reported increased profit for 2 consecution quarters.


Price chart cannot lie
Only buy stock when its price chart is showing up-trend.


Initial Public Offer (IPO)
Never buy Initial Public Offer (IPO) shares because record shows most IPO projections are not achievable.


Free tips
They easily trust the tips they hear from a friend, neighbor, colleague, brokerage firm, or any financial channel that they just watched.


Patient
They always want to become rich quickly. Investors must be patient.


Blind leads the blind
After researching the company properly, if you are satisfied, then only invest in that stock.


Never sell good winning stocks to buy bad losing stocks
.

Safety
After careful research, you might have bought 1 or 2 stocks. It is safer to buy a couple of other stocks to diversify to reduce risk.


https://klse.i3investor.com/blogs/koonyewyinblog/

[winston]

3 Investment Lessons I Learned from a Billionaire

by Brad Thomas

Investment Advice From the Grave Dancer, Sam Zell:-
1. Diversify
2. Never overpay for anything
3. Have fun!

Source: Wide Moat Research

https://dailytradealert.com/2023/07/16/ ... llionaire/

[winston]

5 ways investors can make the most of this earnings season

by Julie Hyman

1. Read earnings previews. They’ll give you insight into what keywords to search for and what themes to focus on.

2. Don’t just look to see if companies beat or missed estimates. Are profits and sales rising or falling? By how much, and why?

3. Did the company change its forecasts? Did it beat earnings estimates but neglect to raise its full-year earnings forecast? Did it explain why?

4. Look at margins. For the tech firms, you might want to word-search “compensation” in the release. Even though inflation is moderating, costs for many companies are not coming down, particularly for labor. Relatedly, look for signs of pricing power (which is now stalling out for some firms after big gains in prices over the past few quarters).

5. Consider the intangibles like culture and management quality. You can glean this from things like long-term stock performance and also from the tone on the conference call. Which executives participate? What is their vibe, and how formal or informal are they? Do they actually answer questions posed by analysts on the call or by journalists in interviews?

Source: Yahoo Finance