I just finished a great book that I think is very fitting to read in this election year. It’s called The Art of Contrary Thinking, by Humphrey B Neill. It’s a collection of articles he wrote in the early 1950’s. You might think a book this old isn’t useful today but things haven’t changed all…
A few quick updates: Growth Allocation I bought a position in Check Point Software Technology (CHKP) this morning after the stock got knocked down following their earnings release. Check Point is one of the oldest Cybersecurity companies out there and is the global leader in unified threat management (UTM) – things like firewalls, network security,…
I’ve been thinking a lot lately about portfolio construction, especially for retirees, in these computer-algorithm dominated investment markets which swing wildly every time someone from the Fed speaks. Markets today are unbelievably short-term focused and my clients aren’t paying me to day-trade their retirement portfolios. This means that portfolios which are built with a long-term…
Everyone knows what it means when something is superior to something else. In this post, I’ll try to explain how I view potential investments in terms of superiority and what a superior investment looks like to me. Let’s say we’re looking at 3 potential investments: A, B & C. If B is superior to C…
Here’s a chart from an article on Bloomberg today illustrating the yield curves of Japanese and German government bonds (the article is worth reading). You have to lend money for 9 years to Germany and more than 13 years to Japan if you want to earn a positive yield to maturity! Some 29% of developed-nation government…
The move in the S&P 500 since January 1st (the selloff, bounce, weak test of the lows and a big surge afterwards) has been so eerily similar to the Aug-Oct move a few months back that it’s a little weird… Even the multiple 2-day retracements in the middle of the surge. The August selloff unfolded after…
Why has the economy been stagnant since 2008? Not the stock market…the real economy: real growth, higher wages, etc. Because we never let the system clear itself of waste, excess, inefficiency and poor investment decisions. I think a good analogy to explain this concept is to think of the economy like a balloon. In order…
With high growth companies leading this recent downturn in the stock market, I thought it would be helpful to explain what drives the direction, or trajectory, of the stock market in the short-term. By short-term, I mean over the next year or so. The trajectory of a stock is the second derivative of the company. We…