To protect yourself from bad markets invest in companies with consistent annual earnings above twelve percent.
Management owning a higher percentage of shareholding is an indication of the management’s faith in the company’s performance and future growth
Do not be a pessimist on global growth because of short-term worries. Keep a positive out look when investing for the long term.
Buy a company that is regularly improving its basic earning power through organic growth and further increasing their earnings through acquisitions in its core areas. Avoid a company which is diversifying in different areas especially through small or large acquisitions. If you want to learn more check out these resources: Warren Buffett’s Top Investing Tips […]
Warren Buffett prefers a company that repurchases its shares when they are available at a significant discount from the intrinsic value. This enhances a company’s per-share intrinsic value further. Invest in such companies for long term growth. If you want to learn more check out these resources: The Value Investing Cheat Sheet Warren Buffett’s Top […]
The buy-and-hold approach is an investment strategy in which stocks are bought and then held for a long period, regardless of the market’s fluctuations. The strategy rests upon the assumption that in the long run stock prices go up. The buy and hold approach minimizes costs and allows the investor to participate in the long-term […]
The businesses of commodity companies such as cement and steel are simple to replicate. No company can make significantly higher returns than its peers. Compare its market capitalization with the replacement capital cost for plants with matching capacity and buy as and when available with adequate margin of safety. If you want to learn more […]
P/E ratio is the ratio of market price per equity share and earnings per share. It is a common measure of how the market currently values the firm’s earnings. If you are a value investor, Graham advises not to invest in stocks where the P/E ratio is more than 15. Following this rule can help […]
One way to find a good deal on stock is to look for shares priced less than 1.5 times the book value. Consider the P/E ratio as a valuation metric. If you are a value investor, Graham advises not to invest in stocks where P/B ratio is more than 1.5. If you want to learn […]
Before buying individual shares it’s important that you know, and completely understand, the key stock picking criteria. Broadly speaking, you should consider these two factors while evaluating your stocks: growth and valuation. Ideally, a stock should exhibit high growth and be priced reasonably. Use EPS, P/E ratio and price-book value for stock picking. Study this […]
Value investing is the investing idea that you can buy a company that is “under-valued” relative to its true value. The reason that its stock is undervalued relative to its fundamentals could be market movements or other outside trends. However, you want to make sure that you avoid value traps, which could mean the company […]
Growth investing is fun, but value investing is where many of the most successful investors made their money. Focus on value investing in companies that have sound fundamentals. Look for the companies that are worth more than their market value, invest in them and hold the investment for long term. Benjamin Graham, known as father of […]
Berkshire Hathaway (NYSE: BRK.A, BRK.B) issued its annual letter to shareholders on Friday, February 28, 2014. Investors frequently look towards it for ideas, trends, and thoughts from one of the most successful investors in history, Warren Buffet. This year is no different and we highlight some of the key points. Berkshire may continue to make […]
The market has been rallying all year — almost reaching all-time inflation-adjusted highs last week. But, at the same time, many young college investors are staying on the sidelines because they are telling themselves, “I’ve seen this before.” And they’re not wrong. It was only six years ago that we were in one of the […]
A lot of people have written about the best investing books or the best books about money, but what about books for the beginning investor? I wanted to put together my list of favorite books to get started investing. These books are designed for the beginner, but still have a lot of solid topics that […]
This post was written by Meiko Acebo, who writes at Financial Bites. Walter Schloss is the ultimate zen investor. When I say zen investor, I mean his laid-back approach to investing. This is not to say that he didn’t have an outstanding long-term investment record to his name. In case you have missed it, Walter […]