Mar 16

Marc Faber is an investment analyst, he is best known for the Gloom Boom & Doom Report newsletter. The newsletter publishes Marc Faber investment advice and investment tips. Faber has been nick named ‘Doctor Doom’

Marc Faber Track Record

His market advice since 2000 is quite accurate.Faber predicted the rise of oil, precious metals, other commodities, emerging markets and especially China in his book Tomorrow’s Gold: Asia’s Age of Discovery. He also correctly predicted the slide of the U.S. dollar since 2002 and the 5/06 and 2/07 mini-corrections.

Marc Faber Investment Advice & Investment Tips

  1. Don’t confuse luck with insight – Faber is famous for advising his clients to get out of the stock market one week before the October 1987 crash. However Faber said that this prediction was “accidental”.
  2. Market Timing is very difficult
  3. There is no value in US bonds – His current tag-line is: ‘buy a $100 US bond and frame it to teach your children about inflation by watching the US bond value diminish to almost nothing over the next 20 years.
  4. Buy gold and other metals – He has said that investors should consider holding part of their wealth in the form of precious metals “because they can be carried”.
  5. Faber believes there are few value investments available, except for farmland and real estate in some emerging markets like Russia, Paraguay, and Uruguay

written by Constantine Njeru \\ tags: , , , , , , , , , , , , , , , , , , ,

Feb 24

Billionaire hedge fund manager John Paulson will forever be remembered for $4 billions he made in 2007. When the housing market was burning the money manager was making billions.

The latest news is John Paulson did it again by earning an estimated $5 billion in 2010 thanks mainly to bets the economy would recover. This is better than the $4 billion haul made off the subprime bet.

How John Paulson Makes Money

John Paulson runs his own hedge fund investment firm, Paulson & Co. Inc. (PCI). It is an employee owned hedge fund sponsor, primarily providing services to pooled investment vehicles. He is earns money through commissions on funds under management plus a share of profits.

John Paulson Investing Strategy

The firm manages separate client-focused portfolios, employing merger arbitrage, long/short, and event-driven strategy to make its investments. Paulson & Co. Inc. utilizes fundamental analysis to make its investments, benchmarking the performance of its investments against the S&P 500 Index.

John Paulson Investment Philosophy

In a Wallstreet Journal interview this is how he summarizes his investment philosophy: “The flexibility of having long and short exposure across the capital structure allows us to optimize performance across market cycles. Our goals are capital preservation, above average returns over the long term, and low correlation to the markets.” As the market recovers from its shortfalls of the past years, Paulson is betting on strong economic growth in the recovery: “it is time to be in the stock market,” he says, and that now is not the time “to be under-invested”.

written by Constantine Njeru \\ tags: , , , , , , , , , , , , , , , , , , , , , , , , , ,

Feb 10

Michael Covel is the author of best selling books Turtle Trader, Trend following and latest Trend Following Learn How to Make Money in Up or down market. Michael Covel trading idea is what matters in evaluating stock is the price. If the price is going up, buy ; Just follow the trend whether that trend is up or down.

Michael Covel trading tips

  1. IPOs are for gamblers, unless you are an insider.
  2. No one knows what the stock market ceiling will be. If they say so, they are making it up. Buy only now if you know exactly how much you can afford to lose.
  3. No one can predict market direction, so you have to be ready to exit and protect your capital. This all requires a trading plan well in advance of entering the market.
  4. The main drivers of sentiment in the stock market is herd behavior, not fundamentals [even though they may say its fundamentals]. People want to get rich fast, so they jump on board [with no exit planned]. That usually ends badly.

Michael Covel website is full of trading and investing resources. You can vist Michael Covel website to read finance articles or even buy one of his books or buy one of his trading course.

written by Constantine Njeru \\ tags: , , , , , , , , , , , , ,

Feb 07

Their is a quote that says “nothing is new, everything that happens today has happened before.” This is true in stock market and even in housing market.

Robert J. Shiller a professor of economics and finance at Yale and co-founder and chief economist of MacroMarkets LLC has posted an article in NYtimes detailing the history of real estate bubbles across USA.

The first real estate bubble happened in 1830s and burst in 1837

The second real estate bubble happened in 1850s and burst in 1857

The third real estate bubble happened in 1970s and burst in the early 1980s

The fourth has been the recent bubble that started in 1990s and burst in 2007

It is clear real estate bubbles have been few and far between. To read the full article visit New York Times Real Estate.

written by Constantine Njeru \\ tags: , , , , , , , , , , , , , , , , , , ,

Jan 13

Oprah Winfrey offers personal finance advice on her website. The Queen of day time TV shares the following personal finance tips.

Oprah Winfrey Personal Finance Tips.

Oprah advices people to divide their their income into five core areas

  1. Education,
  2. Real Estate,
  3. Savings,
  4. Spending
  5. Retirement Investment.

Oprah encourages everyone to invest in financial education ; The only way to can invest successfuly is by understanding how the stock market works, knowing how to read financial accounts and knowing how the economy works.

Oprah says that everyone should plan for the future and at it helps to solve the situation when you are badly in need of money.

Financial Information courtesy of oprah-winfrey.org

written by Constantine Njeru \\ tags: , , , , , , , , , , , , , , , , , , ,

Dec 29

The best way to play the stock market is to seek information that you can help you understand more about companies, industry and economy. Seeking only tips will not get you far because chances are you may act on a bad tip.

I like the following websites for investment advice. They are parked with information that I use to better understand the markets.

Businessweek Online.

I have been a subscriber since I first opened my good old yahoo email account. I have never been disappointed. The recent merger with bloomberg will only make them stronger.

UK Financial Times Online.

To access the full articles you need you need to be a paid up member. They have free account that limits you to read 10 articles a month. But they will send you headlines of all top business news.

Wallstreet Journal Online.

The biggest business publication in the world. With such a large financial support you can be assured they will find business information that matters.

Yahoo Finance.

The beauty of Yahoo Finance is syndicated feed they run on the site. They have articles written from top finance blogs.

Google Finance.

This is not a single site but an aggregator of business news. They have fabulous charts that can help you track trends over a period of time.

written by Constantine Njeru \\ tags: , , , , , , , , , , , , , , , , , ,

Dec 09

Businessweek has a story about investment funds that have invested in Facebook. This funds are providing retail investors with a means to invest indirectly into facebook.

Facebook Funds

EB Exchange Funds, based in San Francisco, along with New York firms Felix Investments and GreenCrest Capital, have opened Facebook funds.

Since you cant buy facebook stock directly you instead buy into the fund just like you buy a mutual fund.

Read the full story at businessweek facebook.

There is no doubt facebook is the biggest story since Google. Those investors who were lucky to get in early are smiling all the way to facebook IPO date. Funds such as EB exchange have given retail investors another window to get a piece of facebook.

Although Facebook is still a private company investors have been able to buy stock of the company. Stock of Facebook trade on a private-company stock market. The market is known as Secondmarket.

Although there is a secondary market it is extremely hard for outsiders to even get a single stock. The funds have provided another window to get into facebook.

written by Constantine Njeru \\ tags: , , , , , , , , , , , , , , , , , , , ,

Oct 13

If you dont want to shell out money to subscribe to a high end investment newsletter then you can take the option of free investment newsletters. Just because these investment newsletters are free doesn’t mean they are junk, some like the ones owned by news organization are resource rich considering they are backed by a team of seasoned journalist & financial experts.

I have benefited alot by using some of these investment newsletters. They provide a doze of daily news, investment tips & market analysis.

1. New York Times Daily Investment Newsletter.

The New York Time online edition providers subscribers with daily email newletter. The newsletter contains various categories of news, among them business, investing and technology. Subscribers get access to all section of the papers.

2. Businessweek / Bloomberg Magazine Newletter

I have been a subscriber since 2002. Although it is not a source of breaking news it is a valuable source of deep research and analysis.See Businessweek/bloomberg

3. Forbes Investment Newletter

Love the Ken Fisher columns, currently ranked as one of the most accurate stock market forecasters.See Forbes.

4. MSN Money Investment Newletter

The site has plenty of resources. free investment newsletters provided by MSN Money’s regular writers. Check MSN Money

5. Motley Fool Investment Newsletter

This site has been around for a long time. I have always used them for research purposes. You just provide the site with your email and they will provide you with numerous newsletter and alert options. Check Motley Fool

written by Constantine Njeru \\ tags: , , , , , , , , , , , , , , , , , , ,

Aug 23

Jim Simon is a hedge fund manager with Renaissance Technologies. A.K.A as “Quants”  Traders with PHds and rely on complex mathematics in making money.

When they came to the scene with their mathematical models for investing it seemed they had found the answer to the age old question “Is there a perfect formula to make money in the stock market?”

From a NYT article:-

Mr. Simons was celebrated as the King of the Quants after his in-house fund, Medallion, posted an average return of nearly 39 percent a year, after fees, from 2000 to 2007. It was an astonishing run rivaling some of the greatest feats in investing history.

With those kind of results it was easy for investors to get carried away with the idea that Jim Simon and the rest of Quants family were the messiahs.

Past results is not an indicator of future performance.

After the collapse of Bear Sterns and Credit crises most Quant funds are fighting for their own survival. The NYT article further reported : -

The combined assets of quantitative funds specializing in United States stocks have plunged to $467 billion, from $1.2 trillion in 2007, a 61 percent decline. And One in four quant hedge funds has closed since 2007

written by Constantine Njeru \\ tags: , , , , , , , , , , , , , , , , , , ,

Aug 02

Although Facebook is still a private company investors have been able to buy shares of the company. Shares of Facebook trade on a private-company stock market. The market is known as Secondmarket.

According to an article I read in Techcrunch

SecondMarket is a private stock market with thinly traded shares where demand often outstrips supply. (By definition, private stock sales trade in an illiquid market)

The Article makes analysis of the latest valuation of facebook, as of june 2010

Shares of Facebook on private-company stock market SecondMarket are going through the roof right now. This week, Facebook shares traded on SecondMarket passed $50, giving Facebook a total market value of $25 billion, according to sources with access to the market. (SecondMarket itself does not disclose pricing or valuation of the private stocks it trades)

Facebook shares are available to investors via SecondMarket. If you want to buy into facebook before the IPOthen you may consider opening an account at SecondMarket. According to the site, Signing Up is free!

written by Constantine Njeru \\ tags: , , , , , , , , , , , ,

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