Use Stock Volume to Your Benefit

So how can you use volume to your advantage?1.  Remind yourself that traders only determine the short term price not the value.2.  Use the volume to help predict the right time to buy more assets or change into a better position.Large volume (relatively speaking) means the price is at a peak or valley.  You are either at the top or the bottom of the chart, you need to determine this.What is Stock Volume?SummaryIn this lesson, we learned the importance of stock volume. Although volume won’t help intelligent investors learn the intrinsic...

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Warren Buffett's Investment Objectives

Goals      Our long-term economic goal is to maximize the average annual rate of gain in intrinsic business value on a per-share basis.  We do not measure the economic significance or performance of Berkshire by its size; we measure by per-share progress.  We are certain that the rate of per-share progress will diminish in the future - a greatly enlarged capital base will see to that. We will be disappointed if our rate does not exceed that of the average large American corporation. 2.     Charlie...

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Uncertainty: Love it or Hate it?

Uncertainty is like a fin you see cutting through the water – many people are uncertain whether the fin sticking out of the water is a great white shark or a dolphin? Uncertainty generates fear, and fear often produces paralysis. This financially unproductive phenomenon has also reared its ugly fin in the investment world, which has led to low-yield apathy, and desensitization to both interest rate and inflation risks. The mass exodus out of stocks into bonds worked well for the very few that timed an early 2008 exit out of equities, but since...

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John Bogle: "The Silence of the Funds"

John Bogle had the following to say in this Morningstar interview: "I am appalled by what has happened in our industry." Here's why. Bogle says that back when he was doing his Princeton thesis in 1951, the mutual fund industry owned a small percentage of stocks. Now, mutual funds are the biggest owner of stocks. In fact, according to Bogle, large institutional money managers of all kinds now own about 66% of stock.  "...a big turnaround over the last half century. And they are silent."  Bogle has a chapter with the title "The...

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To many ICap's shareholders , TTB is their Oracle

Perhaps you have heard of the Oracle of Omaha, the namesake accorded to Warren Buffett. I was at the AGM this morning, my first attendance and the thing I can say is that Tan Theng Boo ("TTB") is like the Oracle of Malaysia for many of these shareholders.In fact, the presentation provided by TTB himself is loaded with Warren Buffett's quotes, such as - "Rule No 1: Never Lose Money, Rule 2: Never forget Rule No 1" and "Price is what you pay, value is what you get" and many more. I would say that much of TTB's investments philosophies and actions...

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Buffett on Banks: CNBC Interview

CNBC's Becky Quick interviewed Warren Buffett yesterday.Interview With Warren Buffett: CNBC TranscriptEarlier in the interview, Buffett said that:"I think the stock market generally is the best place to have money..."Then he added:"...there's no question that worldwide there is some slowing down going on."He also made the following comments about Wells Fargo (WFC), U.S. Bancorp (USB), and banking in general:"In the last week, I bought some Wells Fargo."Then he later said..."But we only have 430-something million shares, so I didn't feel...

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Budget 2013: Becoming the Next Greece

Consistently persistent fiscal deficit is the best description I have for long time ruling coalition government. Fiscal deficit happens when a government's total expenditures exceed the revenue that it has collected (this excludes money from borrowings). An accumulation of yearly fiscal deficits is our national debt. Fiscal deficit is not always a bad thing. However, persistent deficits even during times of economic growth shows...

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Sector Watch: Spotlight on Defensive Strategy

About four and a half years ago, Folio Investing launched an equity (e.g. stock) portfolio that focused on reducing the impact of market volatility.  So-called defensive stocks are those which tend to be fairly insensitive to the mood of the market as a whole.  Conventional wisdom suggests that demand for band-aids, electricity and paper does not go up when the market is exuberant, but neither does it collapse when the market swoons. ...

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The Cost of Complexity

In [Donald] Yacktman's view, businesses with both low capital intensity and low cyclicality (Coke: KO, Pepsi: PEP, and P&G: PG are the specifics mentioned) are likely to earn the highest returns. The benefits owning shares in quality businesses long-term (especially if bought when occasionally selling at a fair or better than fair price) comes down to potential returns relative to risk. Simple to understand? Certainly. Easy to implement as a core investing approach? A bit less so.   The evidence to support...

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