5 Ways Your Brain Tricks You Into Bad Investment Decisions

5 ways your brain tricks you into bad investment decisions - infographic

You are rational with your money. You spend weeks agonizing over the new microwave oven. You read countless reviews and compare features and prices. You worry about risk and insist on a good warranty. You demand value for every hard earned dollar you spend. I expand on risk and investor behavior in this presentation for… [Read More]

Value Investing Stock Selection – The G.U.T – Part 3

More in Value Investing G.U.T Series Part 1: Business Lifecycle Part 2: BCG Matrix Part 3: Stock Selection and Portfolio Management Stock Selection Matters For value investors, active portfolio management remains much more an art then science. There is sufficient value investing literature available that describes the methods and processes fundamental analysis to find appropriate… [Read More]

What is the BCG Matrix and Why We NEED to Know It

More in Value Investing G.U.T Series Part 1: Business Lifecycle Part 2: BCG Matrix Part 3: Stock Selection and Portfolio Management In the previous article in this series, we looked at the lifecycle of a business from startup to growth, maturity and decline. We also learned that value investors typically look at the businesses in… [Read More]

Value Investing as Explained by Danny DeVito

This is a short and concise illustration of the value investing process and makes for an enjoyable viewing. I specially love the part about “but there is one small problem. The company is not profitable …”. Interestingly, he also alludes to the margin of safety concept in this clip Video courtesy: 40procent20ar on Youtube Investing… [Read More]

The G.U.T of Value Investing – Part 1 – Business Life Cycle

More in Value Investing G.U.T Series Part 1: Business Life Cycle Part 2: BCG Matrix Part 3: Stock Selection and Portfolio Management Success in value investing is as much about your approach as it is about your ability to run models in Excel. It also depends on your understanding of the business. There are some… [Read More]

On Liquidity in Small Cap Value Stocks – Why it is Seldom a Problem?

Small cap stocks generally have a liquidity problem. This is one of the reasons why most investors stay away from small cap stocks. This is also one of the reasons why good undervalued stocks are easier to find in this asset class. The market for highly liquid stocks is also normally highly efficient. The price… [Read More]

Value Investing – Why You Fail?

Value Investing is a Treacherous Path

Here is a riddle. Despite countless studies proving the superiority of value investing over growth or indexes, investors do not normally invest for value. Why is that? Don’t they want better performance and greater wealth? Christopher Browne of Tweedy, Browne in his presentation to the Columbia Business School (Nov 2000) talks about how most money… [Read More]

The Bitter Truth About Stock Buybacks

Monster Beverage Corp., (MNST) stock was brought to my attention yesterday as a potential investment due to its fast growth and increased share buy back program. I am going to take this stock as an example to illustrate why company management is often misguided when they repurchase their own stock. Stock Buybacks can Destroy Value… [Read More]