min-myinnersoul

The focus of value investing is basically a strategy to pick a stocks by Benjamin Graham that choose a stock that sell below their fair price. Usually, the main source of information when making the hunt is by looking at the value of PER (price to earnings ratio) and P / BV (price to book value). Common assumption that is often used is to compare the two ratios with other stocks in the same industry. At the point tersebutlah, investors sometimes face value trap. Shares are considered cheap as cheap as it was not suspected. In normal conditions, stock prices will be efficiently follow the true value. Thus, it is possible the shares which are rewarded with low PER or PBV as there are strong reasons underlying it. Then how do I avoid it? Market will become less efficient when there is a bubble or a crash. In both conditions, market participants will be overreaktif. Stock prices are not only influenced by the fundamental condition , but also by the psychological condition of the perpe...

In the 1920s, DuPont Corporation pioneered one of the methods of analysis of company performance up to this time known as the DuPont Analysis. In essence, DuPont analysis done by splitting the return on equity (ROE) into several parts. Why is ROE? ROE describe the magnitude of rate of return earned by shareholders. By splitting the calculation of ROE, we can find out how a business is profit. As we know the formula for ROE is In   DuPont   analysis ,   ROE   is broken down   into 3   parts: or can also be written: ROE = Net profit margin x Assets turnover x equity multiplier Every business has the characteristics of each to get a high ROE. Basically, the industry can be divided into 3 groups: 1. High turnover industries Industries that have high turnover one of which is retail. Competition in this industry is so tight that a high ROE can not be obtained by wearing a premium price to the consumer. To obtain a high ROE they play in the volume of sa...

Selecting stocks is often associated with something as complex and causes a lot of people assume that the ability to pick stocks can only be done by professionals in that field. It is not entirely true. Indeed there are some conditions that cause the need for special treatment to analyze a stock. Fortunately, in many cases are not like that. Joel Greenblatt is the one who introduced the "Magic Formula", a method for stock selection. Joel Greenblatt is the founder of a hedge fund namely "Gotham Capital". The word 'magic' itself can cause a variety of interpretations. Joel Greenblatt himself coined the term "magic formula" because he could show that stock selection process can be done simply. "Magic Formula" was introduced by Joel Greenblatt in his book entitled "Little Books That Beats The Market". This method is far more modest when compared with the methods of Benjamin Graham's stock selection style that has been discussed...

Here are some investment advice from Peter Lynch, one of the best fund managers. This advice is aimed at individual investors. For me, a lot of lessons to be drawn. The advice of Peter Lynch is writing in Worth magazine in 1997. I translate freely as if translated directly would confuse and numb. For each stock we have, continue to follow the story and write in a notebook. Record the latest developments and closely watch earnings. Whether classified as growth stocks stocks, cyclical stocks or value stocks. Performance of good stock or bad there must be a reason. Make sure we know what the reason. Pay attention to the facts, and not a prediction. Ask yourself: how much return we get if you are right and how much potential loss if you are wrong. Look for stocks with the risk-reward ratio of 3 s / d 1 or smaller. Before investing, check the balance sheet to find out whether the company is financially strong. Do not buy options and do not buy on margin. If we buy options, time will become ...

Glitter of the stock market can often make people complacent. Naturally people will feel more comfortable if you follow the joint opinion. Unfortunately the stock market, togetherness can sometimes plunges us into the deepest abyss. Euphoria dot.com stocks in the United States in the late '90s was the result of collective mistranslation caused havoc for most participants. Something similar happened during the great depression hit the world in 1929. Market participants have been 'forgotten' that stock prices can not rise forever, especially if not backed by strong fundamentals . This is where stock valuations we will be footing to be able to be rational in the midst of the hustle and bustle of the stock market. To my surprise, the valuation method used is very simple, especially if we compare it with the screening process is done to look for study fundamental of stocks . Benjamin Graham argues that he is trying to use a magic formula and aim to get results close to the res...

No doubt that Benjamin Graham was a pioneer of value investing. Benjamin Graham looked at the stock as a business and not just as a commodity trading. According to Benjamin Graham, investing is an act that through a thorough analysis, promises safety of our capital and provide a satisfactory yield. Actions that do not meet these requirements are speculative. Benjamin Graham itself tends to be cautious and conservative in selecting stocks. This may be because the market panic of 1907 has led to bankruptcy for his family due to speculative action in the stock market. Benjamin Graham himself did not escape the great depression in 1929, which led to the investment funds it manages customer be dragged along with other investors. Departure from where Benjamin Graham started laying the foundations of conservative investment philosophy and aims to protect the security of capital. The fact proves that Benjamin Graham only takes five years to recoup i...

There are several components that we can make a first step before performing company analysis. Similar analysis as we analyze a business, although there are differences with the usual business analysis. When we do analysis of a company, it helps us pay attention to the relationship between corporate performance with the behavior of its shares on the stock. As was mentioned earlier, in the short term would likely occur with the discrepancy between the value of its stock price. By knowing the prospects of a business and its true value, we can obtain a satisfactory yield. Some basic things that used to analyze a company are as follows: 1. Nature of business.   At this stage we learn how a business is run. What are its products, who marketnya segment, anybody competitors, how the potential for business continuity, how its management. In short, we try to find out how a company operates. Regarding the relationship between business management, there are several possibilities. Sometimes w...

As an investment instrument, the basic   fundamental analysi s of stock can indeed be viewed from different sides. Shares are traded every day on the stock market so the price will continue to change depending on the market sentiment. Shares, which in essence is a sign of ownership of an enterprise (company), can be viewed as a commodity. A fairly wide range of trade each day allows us to profit by buying and selling at the right time. If we look from this side, we position ourselves as a trader. No doubt many traders who managed to get the advantage of using this way. But if we want to be a purist and view the stock as ownership of a business, so before you start investing in stocks, we should know how a company's business is run. If we can take advantage of trading, why do we bother doing fundamental analysis of a stock? After all, by observing the chart, we can make a good analysis as well. One thing to remember, in the short term, the market is a voting machine, whereas in the...