A Look Into Peter Lynch’s Investment Style – What Would He Buy Today?

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Every once in a while, I like to take a closer look at an event that comes up in our “This Day in History” archive, which gets posted daily on Facebook, Twitter, and is now available as an Amazon Flash Briefing. Today we look into the life of Peter Lynch, whose birthday was last week, and one of the most successful mutual fund managers in history. What did Peter Lynch look for in an investment, and what stocks would Peter Lynch buy today? [click to continue…]

What Stocks Would Ben Graham Buy Today? Q1 2018

Ben Graham stock screen

A New Year for the stock markets – That means it is time to run our Ben Graham Value Screens again and see what companies have made the cut this quarter! [click to continue…]

2018 IRA, ROTH IRA, and 401K Contribution Limits (and Income Limits)

Good news on the retirement front this year! For the first time in 6 years contribution limits for some retirement accounts are going up! What has changed for 2018 when it comes to your 401(k), IRA, ROTH IRA, and more? Here’s the quick rundown for most savers:

2018 IRA 401K contribution limits

For more details: [click to continue…]

2017 Stock Market Year in Review (and Charts!)

Another year in the books! Here are some of the highlights:

S&P 500 Index Performance in 2017

U.S. stocks outperformed much of the developed world in 2017. I believe it is the 15th best year  in the index’s history when including dividends.

S&P 500 performance (not including dividends) – 17.74%

S&P 500 performance (Including Dividends Re-Invested)- 21.83%

Range of the S&P 500 during the year: Low: 2,245.13, High: 2,694.97

Chart:

S&P 500 chart in 2017

Top 5 performers in the S&P 500 for 2017:

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86% of Americans cannot answer these basic financial questions. Can you?

Below is a simple 5 question quiz presented to 25,000 Americans, and only 14% got all 5 answers correct.

We have also updated this to include the new “bonus question”available.

 

This is troubling because not understanding these topics can have a profound impact on your future investing success.

 

A lot of families handle their own finances, so it is imperative that the basic topics covered here are understood. At Begin To Invest, I want to empower people to have the confidence to handle their own finances and be able to do it well.

Here, we discuss the topics covered in the 5 question quiz in detail, to ensure you understand these concepts.

Click Here to Take the Quiz

2 Preferreds That Offer Upside Potential And Decent Yield – New Seeking Alpha Post

I have been enjoying having a little more time to look at individual stocks and securities lately. Writing about them helps me think a little bit clearer, and go into more detail. Here is another article I wrote for Seeking Alpha on a couple of preferred shares from DowDuPont (Ticker: DWDP) that are unique: [click to continue…]

What Can Shiller’s CAPE Ratio Tell Us About Future Stock Returns?

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How can you tell if stocks are expensive?

Of course there is a thousand different ratios, indicators and indexes that attempt to measure the value in today’s stock market. Today we are going to look at one of the most popular ratios in particular, Shiller’s PE10 ratio, also known as CAPE ratio. What information can we get from looking at 100+ years of history between stock returns, treasury yields and CAPE ratio readings? [click to continue…]

Dividend Investing – How to Determine if Your Stock’s Dividend is Sustainable

 

A high dividend yield can be a sign of a strong, stable company and investment.  However a large dividend yield may also be a signal of trouble and a hint that the company’s dividend may be unsustainable and cut in the near future.

 

Thankfully for investors, there are several quick checks you can do based on a company’s financial statements to see how sustainable that dividend really is. [click to continue…]

9 Signs of a Competitive Advantage (#9 is One of Buffett’s Favorites to Look For!)

Finding a company with a competitive advantage means finding an investment that will offer solid returns for decades to come. What identifies a company with a strong competitive advantage? Some results may surprise you. [click to continue…]

“Adaptive Markets: Financial Evolution At The Speed Of Thought” By Andrew Lo

I really enjoyed the latest Talks at Google, featuring Andrew Lo. His presentation gives some great examples, and warnings, to investors:
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Oil Investors Should Be Closely Watching This Trend

Pioneer Natural Resources (Ticker: PXD) shocked oil investors when it released their second quarter earnings last week. Shares of the shale driller went from $163 a share to under $130,and other s hale oil names fell as much as 10%.

The company reported $233 million in net income, a 4% rise in production and lower operating costs. So why did Wall Street sell off the sector? They saw this graph:

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Fund Spotlight Series – Emerging Market Funds

 

Emerging market stocks have had a rough decade. 3 year annual returns are flat and even long term 10 year annual returns are barely over 1.5%. But there is new life appearing in the emerging markets. This year the FTSE Emerging Market Index is up 18%, breaking a long term downtrend:

Emerging Market ETFs

Are emerging markets turning the corner?

What’s the best way to invest in emerging markets? We take a look at a few options:

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Weekend Reads – July 23rd 2017

Here are some stories that caught my eye this week: [click to continue…]

What Stocks Would Ben Graham Buy Today? Q2 2017

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Another quarter has come and gone on Wall Street.  That means it is time to run our Ben Graham Value Screens again and see what companies have made the cut this quarter! [click to continue…]

40 Years of Berkshire/Buffett Quotes – Now Updated to Include 2016’s Letter

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Continuing an annual tradition here on Begin To Invest, I added Buffett’s 2016 letter to the compilation of quotes from each year of his letters.

My selection includes some words of wisdom, stories of success and even a joke or two. In the end just these selected quotes make up over 5000 words!  It is amazing to watch history unfold from year to year and just think of what he has seen over the last 50 years….wars, inflation, stock market crashes etc. And yet, his first letter in 1977 could easily be mistaken for something you heard him say on the TV today. [click to continue…]

How to Analyze a Company by Its Inventory

 

Analyze InventoryThe basic operation of a business is centered around 2 steps:

  • Build a Product
  • Sell that product

 

And I would argue that step #2 is the most important. Of course quality of your product is important, but if your product isn’t selling – the business is not making money. Period.

 

Today we are going to look at a few ways to analyze the inventory on a company’s balance sheet to help us measure how well the company is doing selling its product.

 

Inventory is usually the largest current asset on a company’s balance sheet, and is therefore the company’s primary use of cash. We have all seen the new companies on Shark Tank who desperately need money for inventory (Or who have used up all their capital buying inventory). So learning a few basics on what a company’s inventory is telling you is very important.

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What Stocks Would Ben Graham Buy Today? Q1 2017

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It’s a new year, and a new quarter! That means it is time to run our Ben Graham Value Screens again and see what companies have made the cut. [click to continue…]

2017 IRA, ROTH IRA and 401(k) Contribution Limits

Welcome 2017! A new year, which means among many other things, a new year to invest in your IRA, ROTH IRA and/or 401(k). Here are the limits for contributions to IRAs, ROTH IRAs and 401(k)s, and how much you need to be saving each month or each bi-weekly paycheck to reach those limits:

2017-ira_401k-contribution-limits

(Click to enlarge)

 

Confused? (It’s the IRS tax laws – of course you are!) Here it is in text and some of the fine print: [click to continue…]

Analyze A Common Size Balance Sheet, Income Statement and Other Financial Statements – Common Size Analysis (Now Updated)

What is the Difference Between a Common Size Balance Sheet and a Regular Balance Sheet?

 

Common Size Analysis of Financial Statements involves looking at the numbers on the financial statement as a percentage of a total rather than their absolute value. Typically investors will look at a company’s common size balance sheet and common size income statement.

This is helpful when not only looking at a single company’s financial statements, but also comparing multiple business of different sizes at one time. Let’s take a look at an example of a normal balance sheet and a common size balance sheet for several companies:

[click to continue…]

Only 33% of Adults Are Financially Literate – Can You Pass the World Financial Literacy Test?

This was a study conducted by Standard and Poors about a year ago. A little dated, but our previous post (“86 Percent of Americans can not answer all of these questions – can you?“) from 2012 is a post that still brings in a lot of traffic years later. So I wanted to continue the financial literacy theme with a newer study and newer questions. This study questioned 150,000 people across 140 countries.

 

How many could get 3 of the following questions correct? World wide? Just 33% could answer. Americans were slightly better, but still a dismal 57% pass rate. Here are the questions, along with a detailed explanation of the answers. How well did you do? Miss a few? No worries, at the end we explain the answers in detail to ensure you understand the topic. [click to continue…]