Here is a very thoughtful piece from Kenneth Fisher (You can find the link at the side). What follows is extracted for your reading pleasure. Nonetheless, I will endeavour to comeup with 2 good pieces a week starting next week. One will focus on my portfolio monitor (Saturday Morning/Evening). The other will be general market thoughts. So do subscribe to my blog and let your friends know about it. I do appreciate comments!
Quarter-Century Mark
Forbes Magazine dated July 13, 2009
To avoid overpaying, use multiple metrics--not just price-to-earnings but price-to-sales and price-to-book.
This issue marks the 25th anniversary of my column. That's a long run in columnland. It's been a blast. Thanks for your attention. Reviewing my first year's columns, I pondered: What would I still say? What would I say now that I didn't then?
This issue marks the 25th anniversary of my column. That's a long run in columnland. It's been a blast. Thanks for your attention. Reviewing my first year's columns, I pondered: What would I still say? What would I say now that I didn't then?
In the still-say mode: Avoid overpaying. Use multiple valuation metrics--not just the ratio of price-to-earnings but the ratios of price-to-sales and price-to-book. Compare a company with both the whole market and peers. Buy quality cheaply. The title of my second column was "Glamour Doesn't Pay," meaning that the higher growth rates of the most obviously desirable companies didn't justify their premium prices. Still true.
I've done well over time but made lots of mistakes, too. Learn from your mistakes. My Dec. 31, 1984 column, "Big Bloopers of 1984," was a sort of mea culpa, along with lessons learned. The editor liked the notion well enough that a few years later he began requiring all columnists to issue annual retrospectives.
A constant in my approach to investing: You should think politically but unconventionally. Last month I was arguing why Obama will be good for stocks.
Think about size. There are times for big stocks, others when small ones are better buys, and times, like now, when size doesn't much matter
In the didn't-say-then category: Invest globally. The column started out with a domestic focus. That doesn't work in a more globalized economy. Including foreign holdings gives you more opportunities and better diversification.
Featured Content
Originally I thought Republican. Now I'm an equal opportunity politician-hater.
There are times to go to cash, but they are rare. This column has recommended pulling back in three bear markets, beginning first in June 1987, then beginning in September 1989 and then in February 2001. Good calls, but then I was dead wrong with a bullish stance in 2008. Usually getting out is the bigger risk.
In the early days I promoted the idea of spending time in libraries to gain facts that other investors didn't have. Not many people did that kind of research, so it worked. We have a reverse problem now: too much information that's too accessible and not too reliable. There's a lot of mischief and manipulation on the Internet, masquerading as fact or as casual commentary. Beware.
I've done well over time but made lots of mistakes, too. Learn from your mistakes. My Dec. 31, 1984 column, "Big Bloopers of 1984," was a sort of mea culpa, along with lessons learned. The editor liked the notion well enough that a few years later he began requiring all columnists to issue annual retrospectives.
A constant in my approach to investing: You should think politically but unconventionally. Last month I was arguing why Obama will be good for stocks.
Think about size. There are times for big stocks, others when small ones are better buys, and times, like now, when size doesn't much matter
In the didn't-say-then category: Invest globally. The column started out with a domestic focus. That doesn't work in a more globalized economy. Including foreign holdings gives you more opportunities and better diversification.
Featured Content
Originally I thought Republican. Now I'm an equal opportunity politician-hater.
There are times to go to cash, but they are rare. This column has recommended pulling back in three bear markets, beginning first in June 1987, then beginning in September 1989 and then in February 2001. Good calls, but then I was dead wrong with a bullish stance in 2008. Usually getting out is the bigger risk.
In the early days I promoted the idea of spending time in libraries to gain facts that other investors didn't have. Not many people did that kind of research, so it worked. We have a reverse problem now: too much information that's too accessible and not too reliable. There's a lot of mischief and manipulation on the Internet, masquerading as fact or as casual commentary. Beware.
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