Avoid Value Traps

Avoid value traps. I suspect most of us look back on some of our investment decisions and ask 'what was I thinking!?'. I was lulled into investing in some value traps because of: attractive valuation metrics for an extended period (ie. price to earnings (P/E), price to cash flow (P/CF), or price to book value [...]

Consider Investing In Asset Managers

In prior BlackRock (BLK), Blackstone (BX), and Brookfield (BN.to and BAM.to) posts accessible through the Archives section of this site, I touch upon why you should consider investing in asset managers. What Are Asset Managers? In September 2024, KKR (a leading global investment manager) published an excellent perspective of the past, present, and future of [...]

Mitigate Downside and Capture Upside

In my September 13, 2024 How To Think About Risk post, I include a link to Howard Marks' - co-founder and co-chairman of Oaktree Capital Management (the largest investor in distressed securities worldwide) - explanation about the character of risk, the relationship between risk and return, the misconceptions about risk, and how to think about [...]

Avoid Permanent Capital Impairment

If social media is any indication of the typical small retail investor, financial freedom ranks highly as a goal. Reading various social media posts, however, and I can't help but wonder just how few will attain financial freedom. Many posts on social media reference the desire to find the next '10 bagger' (a home run). [...]

You Don’t Need 10 Bagger Stocks To Create Financial Freedom

Don't listen to the hype around '10-bagger' stocks. You don't need them to create financial freedom. What Is A 10-Bagger Stock? A '10-bagger' is a company whose share price multiplies by a factor of 10x from your average cost. As you may well imagine, a very select few of companies globally (~2%) achieve this. Typically, [...]

By |September 15th, 2024|Equity Investing|Comments Off on You Don’t Need 10 Bagger Stocks To Create Financial Freedom

How To Think About Risk

Howard Marks, co-founder and co-chairman of Oaktree Capital Management (the largest investor in distressed securities worldwide), released a series of videos on September 12, 2024 in which he discusses how to think about risk. In the full length video (~36 minutes), accessible through Oaktree Capital Management LP's website, Marks explains the character of risk, the [...]

By |September 13th, 2024|Equity Investing|Comments Off on How To Think About Risk

Invest In Starbucks Now? – Not A Chance

  In my Starbucks (SBUX) guest post at Dividend Power I explain why there is not a chance that I would invest in the company. Starbucks' (SBUX) investors have been rewarded with an annual rate of return in the upper teens if shares were acquired at the end of August 1995 and never sold. It [...]

By |September 6th, 2024|Equity Investing|Comments Off on Invest In Starbucks Now? – Not A Chance
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