As key indices continually reach new all-time highs, some analysts predict that we are in an unstoppable bull market. #-ad_banner-#But others argue that valuations are being manipulated by easy money policies and share buyback programs, which will result in an imminent market crash. As an average investor, it is hard to forecast where the market is going and, thus, where to invest. My answer: ignore the talking heads and follow my secret signal to solid investments and outsized gains. This signal is based on one simple truism: humans are wired… Read More

As key indices continually reach new all-time highs, some analysts predict that we are in an unstoppable bull market. #-ad_banner-#But others argue that valuations are being manipulated by easy money policies and share buyback programs, which will result in an imminent market crash. As an average investor, it is hard to forecast where the market is going and, thus, where to invest. My answer: ignore the talking heads and follow my secret signal to solid investments and outsized gains. This signal is based on one simple truism: humans are wired to act in their own self interest. No one invests their own hard-earned money — or even the money they’ve earned easily — in the hope of anything other than the best possible return. Where your heart lies, there your treasure will be also. That bit of investing wisdom, paraphrased from the Book of Matthew, was true when it was written and is still true today. Consider the CEO of Company X. His stock price is in the proverbial toilet. He can’t get a break on Wall Street, and the problems… Read More

A classic Twilight Zone episode entitled “A Most Unusual Camera” posed an interesting question. If you could take pictures of events that have not yet happened, then what kind of pictures would you take? The characters in that episode took the camera to the race track and snapped photos of the race results — from tomorrow’s races. Investors might be tempted to take pictures of tomorrow’s stock prices. #-ad_banner-#Well, some investors do try to game the system that way, using historical data to predict tomorrow’s hot stocks. It’s called seasonal investing and can involve anything from how a specific set… Read More

A classic Twilight Zone episode entitled “A Most Unusual Camera” posed an interesting question. If you could take pictures of events that have not yet happened, then what kind of pictures would you take? The characters in that episode took the camera to the race track and snapped photos of the race results — from tomorrow’s races. Investors might be tempted to take pictures of tomorrow’s stock prices. #-ad_banner-#Well, some investors do try to game the system that way, using historical data to predict tomorrow’s hot stocks. It’s called seasonal investing and can involve anything from how a specific set of stocks perform around a certain event, to how specific industries perform during certain times of the year.  There has actually been a great deal of analysis on this subject. Ontario, Canada-based investment adviser Brooke Thackray publishes an annual guide entitled “How to Profit from Seasonal Market Trends.” This year’s version, which spans more than 200 pages and can be bought on Amazon.com, runs through a broad range of trading strategies that can be deployed month after month. In fact, this approach underpins the Horizons Seasonal Rotation ETF (Toronto: HAC), which trades on the Toronto Stock Exchange. (Call your broker… Read More

#-ad_banner-#At this point in President Obama’s first term, the world looked very different. The still-anemic economy made it hard to fathom how we would ever get out from under a crushing government debt load. Government spending far surpassed revenue and concerns grew that our key financial backers (such as Chinese bondholders) would pull the rug out from under us. Fast forward to 2015, and the notion that our national debt is any sort of real problem has simply vanished. Sure, the Republican party has been recently threatening government agency shutdowns, but this time the issue is immigration… Read More

#-ad_banner-#At this point in President Obama’s first term, the world looked very different. The still-anemic economy made it hard to fathom how we would ever get out from under a crushing government debt load. Government spending far surpassed revenue and concerns grew that our key financial backers (such as Chinese bondholders) would pull the rug out from under us. Fast forward to 2015, and the notion that our national debt is any sort of real problem has simply vanished. Sure, the Republican party has been recently threatening government agency shutdowns, but this time the issue is immigration and not our nation’s unstable finances. The percentage of Americans that believe that deficit reduction should be Washington’s top priority has slid to a recent 64%, from 72% in 2013, according to a recent survey conducted by Pew Research. However, events across the Atlantic Ocean could bring this issue right back onto the front pages. Make no mistake, decent economic growth, coupled with somewhat higher tax rates on people making more than $250,000 a year, has helped narrow the annual shortfall. What was a $1.4 trillion annual budget gap in fiscal (September) 2009 is now much smaller. A… Read More

I was fortunate to have begun my career during the dot-com boom. It taught me how to successfully navigate a market during a forming bubble… and its eventual bust. #-ad_banner-#The most important lessons I learned on the floor during those years were to watch closely for bubbles, be careful of crowded trades and always anticipate the crowd’s future movements. While they may seem obvious, all three can be extremely difficult to accomplish when you’re in the heat of the moment; especially if you tend to be an emotional trader. Following these tactics allowed me to make money during the late… Read More

I was fortunate to have begun my career during the dot-com boom. It taught me how to successfully navigate a market during a forming bubble… and its eventual bust. #-ad_banner-#The most important lessons I learned on the floor during those years were to watch closely for bubbles, be careful of crowded trades and always anticipate the crowd’s future movements. While they may seem obvious, all three can be extremely difficult to accomplish when you’re in the heat of the moment; especially if you tend to be an emotional trader. Following these tactics allowed me to make money during the late 1990s and 2000s, a historically turbulent time. I’m not bringing this up to pat myself in the back. It’s because what I’m seeing in the market today is eerily familiar. Specifically, one of my favorite indicators is pointing to a bubble in U.S. equities. As I mentioned previously, the forward price-to-earnings (P/E) ratio is at extreme levels. The last time it flashed its current reading was at the end of 2009, and within six months, the market had undergone a correction. The previous time it was even close to this high was in October 2007, when stocks began a 17-month,… Read More

Income investments are an important portion of any retirement portfolio. Historically, they’ve provided retirees monthly or quarterly income distributions to help cover expenses, healthcare and any other living expenses. #-ad_banner-#The other morning I was perusing a Morgan Stanley Smith Barney report that outlined four different 401(k) allocations. While there are many factors that go into an individual investor’s asset allocation, the portfolios range from 25% to 60% in income producing bonds. Along with bonds, the portfolios invest anywhere from 10% to 54% in large-cap stocks. Assuming that part… Read More

Income investments are an important portion of any retirement portfolio. Historically, they’ve provided retirees monthly or quarterly income distributions to help cover expenses, healthcare and any other living expenses. #-ad_banner-#The other morning I was perusing a Morgan Stanley Smith Barney report that outlined four different 401(k) allocations. While there are many factors that go into an individual investor’s asset allocation, the portfolios range from 25% to 60% in income producing bonds. Along with bonds, the portfolios invest anywhere from 10% to 54% in large-cap stocks. Assuming that part of the reason for investing in these types of assets is to add income-producing securities to your portfolio, a logical question to ask is: Do these models account for the lower yields that we’re seeing in the current environment? I doubt it. If you’re trying to earn income by investing in large-cap stocks and bonds, you face serious obstacles. Mainly that yields are down across the board…   The average yield in the S&P 500 is only 1.9%. At that rate, you’re not even keeping up with inflation. Read More

Less than a year ago, over 35,000 people flocked to the “Woodstock for Capitalists” just for a chance to sit in on a six-hour Q&A with the world’s greatest investor — Warren Buffett. #-ad_banner-#To give you an idea of what kind of spectacle this is, just look at sales for Berkshire-owned Nebraska Furniture Mart located in Omaha where the Berkshire Hathaway shareholder meeting takes place every year. In the week surrounding the prestigious shareholder meeting, Nebraska Furniture Mart did over $40 million in sales… which is typically what they do in one month. The… Read More

Less than a year ago, over 35,000 people flocked to the “Woodstock for Capitalists” just for a chance to sit in on a six-hour Q&A with the world’s greatest investor — Warren Buffett. #-ad_banner-#To give you an idea of what kind of spectacle this is, just look at sales for Berkshire-owned Nebraska Furniture Mart located in Omaha where the Berkshire Hathaway shareholder meeting takes place every year. In the week surrounding the prestigious shareholder meeting, Nebraska Furniture Mart did over $40 million in sales… which is typically what they do in one month. The shareholder meeting is one of the greatest financial-education experiences in the world. Attendees get peppered with useful financial information about not only Berkshire, but investing and the economy as a whole. Here are a few great tips that he shared at his recent shareholder meeting. Using Insurance “Float” For Success “Our investment in the insurance companies reflects a first major step in our efforts to achieve a more diversified base of earning power.” — 1967 Annual Report Insurance is Berkshire’s core operation and the engine that has consistently propelled their… Read More

Currently, the Federal Reserve is crushing savers and income investors by keeping interest rates near zero. #-ad_banner-#But the good news is that there are dozens of safe ways to make 10 times more than you would by investing in a CD or a Treasury bill. In fact, there are currently 288 stocks that yield more than 10%, 173 that yield more than 12% and 95 yielding 15% or more. While not all stocks yielding double digits are good investments, owning a handful of reliable dividend payers is the safest, easiest way to build wealth. Read More

Currently, the Federal Reserve is crushing savers and income investors by keeping interest rates near zero. #-ad_banner-#But the good news is that there are dozens of safe ways to make 10 times more than you would by investing in a CD or a Treasury bill. In fact, there are currently 288 stocks that yield more than 10%, 173 that yield more than 12% and 95 yielding 15% or more. While not all stocks yielding double digits are good investments, owning a handful of reliable dividend payers is the safest, easiest way to build wealth. n fact, 156 years of data prove that owning dividend paying stocks and reinvesting those dividends beats all other investment approaches hands down. If you’re skeptical consider this: Anyone who invested $1,000 in the S&P 500 in 1950 would have $1,033,799 today as long as they reinvested the dividends. Without dividend reinvestment, that figure shrinks to a measly $117,471. So why does investing in dividend payers make such a difference? Because these are the stocks that often perform the best, even during periods of extreme market turmoil. Take… Read More

These days, investors are bombarded with a lot of chatter from the market. #-ad_banner-#The internet, TV and radio are flooded with so-called “experts” claiming to know the future of the economy and offering varying opinions on where investors should place their hard earned dollars. On any given day, you might come across a dozen articles online claiming the market is in-store for a major bull run, only to see a news report claiming the next recession is just around the corner, not even an hour later. With the market presenting you… Read More

These days, investors are bombarded with a lot of chatter from the market. #-ad_banner-#The internet, TV and radio are flooded with so-called “experts” claiming to know the future of the economy and offering varying opinions on where investors should place their hard earned dollars. On any given day, you might come across a dozen articles online claiming the market is in-store for a major bull run, only to see a news report claiming the next recession is just around the corner, not even an hour later. With the market presenting you such a mixed bag of opinions, how are you to know what investments you can actually trust? Simple: just ignore it completely. Now, I know that might sound like a stretch, but trust me, it isn’t. The market — and its thousands of pundits — often panders to what I think is an investor’s absolute worst enemy: their emotions. Whether its fear, optimism, excitement or panic, many investors have a way of letting their emotions completely cloud their judgments. And often times, that can cost them a big… Read More

I probably don’t have to tell you this, but the odds are stacked against you when it comes to “beating the market.” By nearly 6 to 1 in fact… Investment analysts, advisors and fund managers — the so-called experts — spend their entire working lives and billions of dollars on research vowing to “beat the market” in any given year — yet the vast majority of them fail… Just look at mutual fund industry’s record. In the past three years, just 14% of actively-managed mutual fund managers matched or exceeded the… Read More

I probably don’t have to tell you this, but the odds are stacked against you when it comes to “beating the market.” By nearly 6 to 1 in fact… Investment analysts, advisors and fund managers — the so-called experts — spend their entire working lives and billions of dollars on research vowing to “beat the market” in any given year — yet the vast majority of them fail… Just look at mutual fund industry’s record. In the past three years, just 14% of actively-managed mutual fund managers matched or exceeded the market’s performance according to Standard & Poor’s. So how are the small minority beating the market? After years of research, we’ve found that more often than not, investors who keep these two rules in mind when choosing stocks have been proven to collect higher dividend yields and consistently beat the S&P 500… #-ad_banner-#Dividend payers beat non-dividend payers. It probably comes as no surprise that, over time, investing in companies that return money to shareholders in the form of dividend payments make a much better investment than putting money in stocks… Read More

Today we want to tell you about an investing strategy that defies logic. It shouldn’t work based on everything we’ve learned about the stock market. #-ad_banner-#Yet it does. In fact, for over half a century, investors and traders have used this strategy to produce unparalleled results. And no, for those of you who may be wondering, this strategy doesn’t involve options, derivatives or any other obscure financial product. What’s more, what I’m about to show you can be used as part of any general investing strategy — regardless of whether you’re… Read More

Today we want to tell you about an investing strategy that defies logic. It shouldn’t work based on everything we’ve learned about the stock market. #-ad_banner-#Yet it does. In fact, for over half a century, investors and traders have used this strategy to produce unparalleled results. And no, for those of you who may be wondering, this strategy doesn’t involve options, derivatives or any other obscure financial product. What’s more, what I’m about to show you can be used as part of any general investing strategy — regardless of whether you’re focusing on income, growth, blue chips, small caps or even commodities. pecifically, I’m talking about relative-strength investing. Longtime readers might already be familiar with relative-strength investing. We’ve talked about it before in previous StreetAuthority Daily issues. For those who need a refresher, here’s a brief recap. Relative strength investing is simply a type of momentum investing. It involves buying the best-performing stocks (relative to the market) and holding them until their momentum changes course. To most investors, especially those considered value investors, this strategy probably sounds ridiculous. After… Read More