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  • The Challenges of Using Beta to Measure Risk  [View article]
    I understand beta just fine. I simply don't find it to be an accurate measure of "risk" as the average investor looks at it. If it helps you, that's great for you!

    May 24, 2011. 12:40 PM | Likes Like |Link to Comment
  • The Challenges of Using Beta to Measure Risk  [View article]
    See, I didn't attack the author, or anybody else on this site for that matter. Why you feel the need to defend him so unnecessarily is curious.

    I fully understand beta. I simply don't believe that beta is useful for somebody who is investing for the long run. If the "market" (benchmark) is the comp, and the comp is risky the beta of company X is only useful to speculate on the direction of the broader market (there are better ways to do that)
    May 24, 2011. 09:39 AM | 1 Like Like |Link to Comment
  • The Challenges of Using Beta to Measure Risk  [View article]
    Measuring risk in relation to a benchmark that is itself risky in a different way is of little use. If a stock is closely correlated to a market that itself could be labeled risky, the stock is also risky regardless of what its beta is.

    Strong management and solid growth potential resulting from highly sought after products and services are the true factors that impact one’s risk when investing in a company. If you feel comfortable with these aspects of a company, and you are truly investing as opposed to “playing” the market, beta is a worthless risk metric. If you are actively trading the stock of a given company, beta is little more than a quantitative metric used to justify speculative decisions. Either way, beta offers very little in the way of true risk analysis.
    May 23, 2011. 02:04 PM | 2 Likes Like |Link to Comment
  • Two Conservative Stocks, Stunning Results  [View article]
    I like the premise of this article in theory, but in practice it's simply not the reality of today's market.

    As CDN Trader pointed out, Warren Buffet (and his mentor Benjamin Graham) would surely disagree with me; but then Buffet has the luxury of swooping in with his deep pockets to scoop up companies at unduly low prices which he will then sit on until "Mr. Market" gives him what he considers a reasonable price.

    The reality for most investors is that their are a relatively small number of large institutional traders out there that move markets. This theory is pushed by Jim Crammer; and, while I don't subscribe to his thinking on much, I think he has this right. It matters not if you think Intel (INTC) is underpriced... If the hedgies want to drive it down, they can and will. Sure you can benefit by buying after the price has been driven down, but you have to be willing, like Buffet and his billions, to wait for the big boys on wall street to change their mind.

    Strategically buying (buying dips) shares of companies that pay a nice dividend, have a shareholder-friendly management, and then strategically selling (in buyers' markets) to lock in gains is the best anybody can do on their own... this strategy is pleanty challenging even for seasoned investors!
    Dec 3, 2010. 02:35 PM | 4 Likes Like |Link to Comment
  • The Travelers Companies: Because Safe Stocks Are Hard to Find  [View article]
    TRV is a compelling buy right now. excellent margins, and a cheap valuation compared to both the industry and the market as a whole. The yield (Roughly 2.5%), won't blow your hair back, but it's certainly respectable.

    To be sure, the low interest rates hurt investment returns for the insurers, but with the yield near the 10-year treasury (TRV- 2.5 Treasury - 2.87) and rates that can only go higher, TRV is offering an attractive entry point right now.
    Nov 26, 2010. 10:44 AM | Likes Like |Link to Comment
  • Growth vs. Value: The New Buggy Whip  [View article]
    First part of the article has some merit, value/growth distinction is one that never made much sense to me... an investment ought to have both value and growth prospects... that's just fact. To argue that "growth" stocks have different funadamentals than "value" stocks is largely unimportant... the distinction has more to do with speculation and little value to a true long-term investor.
    Nov 22, 2010. 01:06 PM | 6 Likes Like |Link to Comment
  • On Retirement Investing and Managing Expenses  [View article]

    The failures of the soon-to-be retirees to save for retirement is to be blamed on nobody but themselves. My concern is for the post-boomers who are watching their parents enter retirement with little or nothing more than SS and nobody to tell them how to avoid this future for themselves.

    I don't think we differ so much in our opinion. People make bad decisions and leave the rest of the country to pull them up by their pocketbooks, this is the world we live in. Unfortunately, It's likely that SS withholding will go up and retirement age will do the same.

    To your point about SS not being designed as anybody's sole source of retirement income, you are correct! What's more, when it was created, people weren't living nearly as long either. Once again, it is unfortunate that people took this program as anything more than a supplement.
    Oct 28, 2010. 10:02 AM | Likes Like |Link to Comment
  • On Retirement Investing and Managing Expenses  [View article]
    What is most troubling to me as an investment advisor in my 20's is how little my generation has been taught about financial prudence.

    It is not as simple as choosing not to save at a young age as richjoy suggests. There is a fundamental lack of understanding of available options. Companies hiring entry-level employees do a sub-standard job of explaining qualified plans, and an even worse job of providing investment choices suitable for younger employees. Employer-sponsored plan administrators would do themselves a great service my making attempts to educate potential plan members about the benefits of a structured retirement savings plans made easily available to them by their employers. In my experience, and from what I'm told by my peers, very little of this is being done.

    To make matters worse, younger generations have grown up learning from the generations of people who are now entering retirement grossly unprepared.
    Oct 27, 2010. 10:17 AM | 1 Like Like |Link to Comment
  • The Fallacy of Explanation  [View article]

    You've managed to succinctly state what I've been thinking for months. "News" is printed because people expect it to be there, not because anything materially relevant actually occurred. The average investor wants AN explanation, not THE explanation. This has created an atmosphere where successful news-pickers are the new stock-pickers!
    Sep 21, 2010. 04:25 PM | Likes Like |Link to Comment
  • What Does It Take to Be a Wall Street Analyst?  [View article]
    Things don't look to get any better with record numbers of CFA candidates failing their exams...
    Aug 19, 2010. 01:55 PM | Likes Like |Link to Comment