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Investing

Posted By Robert On Saturday, January 4th, 2014 With 0 Comments

As an individual investor, your time horizon is considerably longer than a trader. Therefore, you should welcome price declines in the stocks of excellent companies such as Google. This gives you the opportunity to pick up shares at discounted prices.  Please note that this section and course is targeted to investors; this is a different methodology to financial trading.

What is Investing?
An Alternative Way of Looking at Investing in Stocks
Long Term Investing
Investing: Ignoring the Short-Term
Incentivizing Wealth Creation
Macro Factors that Affect Long Term Investment Returns
Do I need a Stock Broker?
MicroCap and Penny Shares
Benjamin Graham and David Dodd Value Investing Criteria
Valuing Growth Shares
Efficient Market Hypothesis
After Social Networks – What’s the Next Big Thing?
Exchange Traded Funds
Looking beyond Net Income and Earnings per Share: Some Frequently Asked Questions

Investing Course
Setting Your Financial Goals
Determining your Investing Style
Understanding your Risk Tolerance
When to Start Investing

Introduction to Investing
Making an Online Trade
Types of Investments & Their Rates of Return
Risk versus Reward: Understanding the Tradeoff

Building Your Diversified Portfolio
Basics of Building a Profitable Portfolio
Investing in Technology Companies
Investing in Pharmaceuticals and Health Care Stocks
Making Money with Banks and Insurance Stocks
Energy Shares and Companies
Utility Stocks: Phone and Power Companies

Strategies for Reducing Risk
Asset Allocation
The Importance of Diversification
Small Caps versus Large Caps
Dollar Cost Averaging

Investing Basics & Mistakes to Avoid
Buy and Hold versus Timing the Market
Good or Bad Investment?
Avoiding Ten Common Investing Mistakes
Stock Exchanges Explained

How to Read Financial Statements
How to Read a Balance Sheet
How to Inspect Income Statements
Analyzing Stocks

Economics
How To Get Rich| The TurnKey Money Making Myth Busted
Auction Winners pay over the Odds | The Winners Curse
Herbalife The Great Pyramid Scheme
Diamond vs Water | A Debate of Commodity Prices
What affects house prices?
China | The Advantage of Backwardness
Inflation and why it affects us all
Conspicuous Consumption
Monopoly, Oligopoly and Cheese
Commodity Booms since World War 2
Second Hand Markets
Recessions and Innovation
Investing in Diamonds?
Bubbles, Tulips and Gold
Tesco and Monopolies
Phillips Curve | Inflation and Unemployment
Sell in May and Go Away??
20 Great Warren Buffett Quotes

Investing Principles
Investing Tips
Investing Books

An investor would look at the long- term (five to ten years down the road) prospects of a business and how stocks are currently priced relative to these prospects.

In particular if you look at individual companies you would do well to pay close attention to the level of economic profit that a company attains. You are looking for companies that can earn steady and predictable economic profit over the long-term.

Don’t worry about whether “new economy” stocks continue to suck money out of “old economy” stocks. Ten years from now, it will boil down to what companies are the ones who are making money. If a business keeps increasing its economic profit and the stock continues to sink, you should take advantage of the discounted prices that the market gives you. We believe the stock market is miserably inefficient in the short-term since fear and greed dominate. But over the long-term, the stocks that go up are the ones that continue to increase their business values year after year.

A note on interest rates. The stock market as a whole depends on the level of interest rates as well. Remember the value of a stock depends on the present value of all the cash that can be taken out of a company over its lifetime. As interest rates rise, the value of all stocks declines.

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