What BitCoin Can Teach You About Investing

By Jack Forehand, CFA (@practicalquant) — I am unfortunately not one of the people who has enjoyed the two thousand plus percent return of BitCoin this year. I have spent a lot of time studying it, and in hindsight I certainly wish I had bought it when I began that research process, but as a disciplined (at least most of the time) value investor who runs fundamental based investment strategies for a day job, I… Read More

Tips for Being a Smarter Investor

A recent Kiplinger article offers an overview of an interview with Raife Giovinazzo, Ph.D., a partner at Fuller & Thaler Asset Management, a firm that invests based on behavioral finance principles (Giovinazzo earned his doctorate under Nobel Laureate Richard Thaler). The following are some highlights: Why don’t markets behave rationally? According to Giovinazzo, “It’s not that we’re stupid or overly emotional. It’s just that being human means that sometimes we’re going to make mistakes.” Giovinazzo’s… Read More

Value Trap Warning Signs

Today’s high stock market valuations make cheap stocks attractive, but a recent Bloomberg article warns that the market is “littered with ‘value traps’—stocks that look cheap but never substantially rebound.” The article provides 12 value trap warning signs, as follows: The business is still struggling at the peak of its operating cycle. Company management compensation structures haven’t changed in the face of the stock’s declining performance. The company “dominates a smaller U.S. city. Managers have… Read More

Questions to Answer Before Dashing into Cash

Keeping some cash on hand might be a good idea if you’re going to need it soon, say many financial experts, but it could be a bad strategy for long-term investors reacting to fear of a market correction. This according to a recent article in The Wall Street Journal. The question is, the article points out, how much cash to reserve and where to put it? A move to cash, the article argues, should be… Read More

The Invasion of Artificial Intelligence

“If computing power and data generation keep growing at the current rate,” says Luke Ellis of UK based Man Group Plc, “then machine learning could be involved in 99 percent of investment management in 25 years.” This according to an article in Bloomberg. Some major money managers are on the AI bandwagon, the article reports, citing Two Sigma and Goldman Sachs Group as firms that have adopted AI as a “cornerstone strategy or research tool.”… Read More

Overseas Investors Buying U.S. Stocks Again

After four straight years of pulling money out, foreign investors have invested $66.4 billion into the U.S. stock market through September, the “biggest buying spree since 2012,” according to a recent article in The Wall Street Journal (data from Deutsche Bank). “And there are signs that foreigners aren’t done buying,” the article says, noting that a recent survey by Bank of America Merrill Lynch showed that allocations to U.S. equities by global fund managers rose… Read More

Longtime Bull Jeremy Siegel Predicts a Milestone

In a recent CNBC interview, Wharton finance professor Jeremy Siegel–who predicted the Dow’s rise to 24,000—said he thinks the index will hit 25,000 adding that the milestone will be spurred by tax reform. [Note: the DJIA closed yesterday at 24,504.] “The corporate tax cut is particularly what I think the market wants,” Siegel said, adding, “That could boost earnings by 8 percent or so, and that’s a positive for stocks.” That said, he argued that… Read More

Chiron Capital Called “A Fund for All Seasons”

A recent article in Barron’s profiles the investment philosophy of Ryan Caldwell, lead manager of Chiron Capital Allocation fund, a world allocation fund (launched in 2015) that has the flexibility to “invest anywhere within a wide range of allocations.” Since its inception, the article reports, the fund has delivered a 24.4% cumulative return, outperforming because many of its peers gravitate toward value stocks. “Growth,” says Caldwell, “is now squarely in leadership in the U.S. and… Read More

Luck or Skill? Focus on the Process, not Performance.

By John Reese (@guruinvestor) —  Is it better to be lucky or smart? When it comes to investing, I think we can all agree that success arises from a combination of the two, but to what degree has been the subject of much debate. Those who are well-studied in behavioral finance would tell you that investing is rife with the illusion of skill—an investor’s inflated, misplaced confidence in their own abilities to choose winning stocks.… Read More

Most Read Posts on Validea’s Guru Investor

Below are links to our most popular posts for this week on Validea’s Guru Investor blog. [1] Focus on Fundamentals Rather than “Expert” Forecasts [2] The Dangers of Data [3] Goldman Sachs: High Valuations Mean Pain is Coming [4] Undervalued Value Stocks Could Rebound ——- Photo: Copyright: arcady31 / 123RF Stock Photo