I have written a bit about value investing lately. Mainly in the context of Warren Buffett and Benjamin Graham, two staunch advocates of value investing.
But there is also growth investing. A slightly different approach to investment analysis.
Today we will show a little love for those who wish to acquire growth stocks. (more…)
I mentioned Benjamin Graham in “Mistakes of Warren Buffett” and recommended his book, “The Intelligent Investor”.
Benjamin Graham mentored Warren Buffet and is considered the founder of value investing.
Today, a quick summary on Benjamin Graham and his three key principles for value investing. While they may not turn you into the next Warren Buffett, these investment tips will make you a better investor. (more…)
I love the investor, Warren Buffett. Hate the politician, Warren Buffett, but love the investor.
I believe the Benjamin Graham based investment philosophy utilized by Buffett is excellent. An investment style worth emulating for individuals who invest in individual securities.
Identify solid companies in growing industries, with superior products or services, and run by first-rate management. Then invest for the longer term.
The results are evident both in the personal success of Warren Buffett and in his primary investment vehicle, Berkshire Hathaway.
But neither Benjamin Graham’s style nor Warren Buffet are infallible. Mistakes can be made. (more…)
Some financial advisors advocate a buy and hold forever strategy for individual stocks.
They cite such successful investors as Warren Buffett, Benjamin Graham, and John Templeton as staunch believers in a buy and hold forever approach.
Or financial experts tout articles like “The 7 Best Stocks for a Lifetime”.
As a good friend whose birthday is this week would put it, “Complete foolishness, I say.”
And she would be right. (more…)
Warren Buffet has done exceptionally well as an investor and businessman over the long run.
That said, I do not believe that the average investor can emulate Buffet’s approach.
But Buffet, in his folksy Nebraskan way, does offer some great advice.
This linked article from Business Insider shares 15 of his top short snappers.
A few thoughts from my side on some of the points Buffet makes. (more…)
Following a growth strategy is another common method of investing in equities. You will also see many mutual funds that utilize this style.
Today we will take a look at growth investing.
What it is. How it compares to value investing. And some areas to watch out for when trading in growth stocks. (more…)
Another ratio used by value investors, as well as seekers of cash flow, is the dividend yield.
Whereas value investors seek companies with relatively low price-to-earnings (P/E) and price-to-book (P/B) ratios, they desire companies with high dividend yields.
Today we will look at the dividend yield. (more…)
Another common analytical calculation is the price-to-book (P/B) ratio.
This is popular among value investors.
While price-to-earnings considers a company’s future earnings potential as a way to determine share price, P/B incorporates what the company owns.
Not a ratio that I find very useful, but many others do, so you shall not suffer for my biases.
We will cover how to calculate and use P/B ratios, followed by limitations in the ratio’s effectiveness. Then I will show you how to make the P/B ratio a little more practical. (more…)
Within equity analysis, the price-to earnings ratio is the most common calculation.
Key to any analytical style, it is one of the cornerstones for value investing.
Today we will look at the concept and its uses. We will also review some of the limitations of the price-to-earnings ratio. (more…)
Equities are often viewed through the prism of being either value or growth stocks.
This is especially true when reviewing different investment styles for equity funds.
Today we will take a look at value investing. (more…)
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