Category Archives for "How To Invest"

Bear Markets, Recessions, and How to Profit From Them

1987 stock market crash

IntroductionBear Markets are the bane of the investor, with two exceptions: professional traders who specialize in short-selling, and regular investors who have a particular skill. Namely, they have learned how to tell the difference between market declines that are linked to a recession, and those that are not. Those who have mastered this skill are […]

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My Personal Market Dashboard

My personal market dashboard is invaluable to me. It’s both my GPS and my BS detector. I designed it in a way that forces me to confront the facts on the ground, so that my writing doesn’t drift too far from reality. A little backround I have been captivated by the capital markets since I […]

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Critical Thinking Skill #4 – Emotional Intelligence

mike tyson

What Mike Tyson can teach us about Emotional Intelligence When I talk about emotional intelligence with clients, they often think of it as having emotional control over their investing behavior. This is true, but it’s just one aspect of this critical thinking skill. Emotional intelligence is a broader concept. I’ll try to explain it with […]

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Can A Sector Rotation Strategy Beat The Market?

sector rotation 3 wk

We look at how sectors move, relative to the market and to each other. The return behavior of sectors over time offers investors valuable information. This relative return behavior gives us clues about shifting market leadership. How you allocate equity exposure among sectors is a key driver of portfolio performance.  Introduction A popular approach among […]

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The Greater Fool Theory

dilbert

One of my favorite TV shows in recent years is HBO’s The Newsroom. The guy who writes the show, Aaron Sorkin, is known for fast-paced, snappy dialog. In the final episode of season 1, economics reporter Sloan Sabbith (played by the lovely and talented Olivia Munn) tells her boss, anchorman Will McAvoy (played by Jeff Daniels): […]

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A Little Tough Love for Stock Pickers

george plimpton detroit lions

Do you consider yourself a member in good standing of the community of amateur stock pickers? If so, you best be a truly exceptional one because if you’re not, the road ahead of you is going to be unpleasant. Maybe you’ve already learned this, or maybe you’re still in denial. Either way, you’re eventually going […]

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Critical Thinking Skill #3 – The Time Value of Money

time value money

The Time Value of Money is one of the first skills a new investor must learn. Simply put, it answers the question “What is the value to me today, of a dollar that I expect to receive at some point in the future?” This article will walk you through the process of answering that question. […]

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Characteristics of highly accomplished investors

skill

What do Warren Buffett, George Soros, Carl Icahn, Ray Dalio, Abigail Johnson, James Simons, Thomas Peterffy, Ron Perelman, and Steve Cohen all have in common? They are all highly accomplished investors. And they make up 9 out of the 10 richest Americans, according to Forbes, Inc. Introduction The fact that 9 out of the 10 […]

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How to Increase Your Odds of Winning at the Investment Game

How to Increase Your Odds of Winning at the Investment Game Summary Stock market strategy can be understood using game theory. The players in this game have widely different skill sets. Profits flow from low-skilled players to those with better skills. Every investor has a strategy, even if that strategy is “I just go by […]

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Why Factor-Based Investing Works

factor-based investing 3

Why Factor-Based Investing Works Contrary to what you may have been told by experts, gurus, and sages in the investment industry, individual investors are perfectly capable of constructing portfolios that produce non-trivial amounts of Alpha (excess returns above the market return), in a persistent and systematic way. This is the conclusion reached by several recent […]

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