If you’re scouring the calendar for the best trading day of the month, the search ends with actionable insights. Short on speculation and long on evidence, this article zeroes in on the critical question – what is the best trading…
Traders and market analysts keep inventing new tools to navigate the ever-changing landscape of financial markets, and one such tool is the CMO Absolute Indicator. What do you know about this indicator? The CMO Absolute indicator is a momentum indicator…
Which is more profitable – trading or investing? Who makes more money – traders or investors? The short answer is that you can get rich quickly by short-term trading, but you are more likely to make money by long-term investing. A…
I signed my first client and proceeded to short my first stock. It almost proved to be my last. Over the next few weeks, I watched the stock trade up to 20, then 30, then 40, finally breaking through 50…..But…
Nassim Nicholas Taleb invented the word antifragile in his book with the same name when he was looking for the opposite of fragile. Antifragile is relevant for investors. What is antifragile investing? In this article, we look at how you…
Most people invest in real estate, perhaps quite logically since this is a very easy business model to understand. Equity (stocks) is perceived as riskier and thus less desirable as an investment. The aim of this article is to give…
An investment checklist is handy, no matter your time horizon or investment style. The bare minimum is a mental checklist, but preferably it should be written. Like the aviation industry developed checklists to avoid disasters, investing is about error removals….
Some IPOs go on to be multibaggers, like for example Facebook, Amazon, and Netflix, to name the most successful, but this article provides you with 9 reasons not to buy an IPO. For every IPO success, many more failures tend…
The period from October to May (next year) has been the best period for US stocks since at least 1960. Practically all the gains have come during these seven months. But if we look at the different sectors of the…
How does war affect the stock market? Can we expect poor returns and increased volatility? Or is it a good time to buy when you hear the sound of cannons? Perhaps counterintuitive, history suggests that stock markets show less volatility…
Meb Faber, a famous money manager and writer, has several times stated he is a trend follower at heart. Back in 2015, he published an article about momentum and trend-following strategy called Meb Faber’s Three-Way Model in gold, stocks, and…
The founder of Investor’s Business Daily (IBD), William O’Neill developed the CANSLIM method to help him pick the best stocks. In his best-selling book How To Make Money In Stocks, O’Neill described his method in detail. CANSLIM is a method…
The relationship between stocks and interest rates is at the center of financial theory. Why? Because the interest rates determine the value of stocks. High rates equal less appetite for owning risky assets, and investors will only own risky assets…
The lower the interest rates, the more attractive it is to own risky assets like stocks, gold, and Bitcoin. This relationship is at the cornerstone of the financial theory. In this article, we do a backtest to look at the…
What happens to stocks when interest rates go up? Our backtest reveals that when rates go up, stocks don’t perform well, just as the financial theory says they would. The cornerstone of the financial theory says that the higher the…
Have you ever wondered what are the best performing stock markets in the world? Almost every country has a functional stock market, but not all countries’ stock markets have been performing the same. If your great-great-grandfather had invested $1 in…
Sector trading and investing is a type of strategy where an investor focuses on buying or investing (and later selling) securities within a specific sector of the economy. For example, an investor may focus on buying and selling stocks within…
No matter how good strategies you have, they are most likely worthless if you can’t execute them properly. What looks like a piece of cake on paper, is completely different in the real world when you are risking your own…
Harry Markowitz won the Nobel Prize in 1990 for his work in showing mathematically how to reduce risk and create better returns by diversifying across regions and assets. Risk is measured in volatility, i.e. how your assets fluctuate in price….
Ray Dalio’s All-Weather Portfolio was constructed to stand the test of time, no matter the investing climate – be it inflation, deflation, or stagflation. How did the portfolio perform during Covid-19, a period that witnessed enormous volatility? Ray Dalio’s All-Weather…
Yesterday, the 3rd of September 2020, witnessed a pretty big drop in the stock market with Nasdaq leading the decline with a drop of 5.07%. Out of interest, I looked at the performance of September going back to 1970, using…
It’s important to avoid trading mistakes to increase profits. “The good is mostly in the absence of the bad”, as it is nicely summarized in Nassim Nicholas Taleb’s Antifragile. Put short, if you avoid the gravest mistakes, winning tends to…
Stock picking is difficult because only a small minority of the stocks contribute to the majority of the gains. It’s skewed to only a few outliers. It’s as simple as that. Let’s look at some facts: Most stocks don’t beat…
Some weeks ago I published an article looking at the worst month in the stock market: September. Today, 29th of September, as September is coming to an end, and we’re about to enter the best season being invested in stocks:…
Is it possible to get rich by investing in stocks? If so, how do you get rich investing in stocks? It’s possible, of course, to get rich from stocks, given certain assumptions. However, being patient is mainly how to get…
Many investors are obsessed with identifying future multibaggers. How can you find multibagger stocks? Unfortunately, it’s not easy. In this article, we look at a specific research report that addresses how to find multibaggers. The main takeaways from the report…
What is the Holy Grail of investing? The Holy Grail is often used to describe a method to achieve eternal success or happiness, depending on your goal. The Holy Grail is the lure of high and consistent returns in investing….
A recent study about Norwegian traders and investors sheds some light on the returns (or lack of) based on diversification, age, wealth, and risk appetite. The study is called What Do the Portfolios of Individual Investors Reveal About the Cross-Section…
Bitcoin has appreciated a lot over the last years, and polarized discussions on social media continue endlessly about which asset will perform the best in the future. Many swear to Bitcoin and cryptos, while others swear to the more traditional…
Known as the Oracle of Omaha for his investment prowess, Warren Buffett is one of the most popular investors in the world. According to Bloomberg, Buffett has amassed a personal fortune in excess of $100 billion. Want to know about…
In the book, “Reducing the Risk of Black Swans”, an educational treatise on how to avoid unexpected catastrophic losses, Larry Swedroe presents the Larry Swedroe Portfolio. If you want a way to maximize returns while minimizing risk, the investment approach…
Mebane T. Faber, along with Eric W. Richardson, is a co-founder of Cambria Investment Management and serves as the company’s Chief Investment Officer. In 2009, they released a book called “Ivy Portfolio,” which outlines their investment strategy. Let’s take a…
Frank Armstrong is a financial advisor, author, and the founder of Investor Solutions, a registered investment advisory firm based in Miami, Florida. With over 30 years in the financial industry, Armstrong has written several books on personal finance and investing,…
Harry Browne was an American investment advisor and financial writer. He was best known for his investment philosophy and strategies, which he outlined in several books. In his book “Fail-Safe Investing,” Harry Browne introduced the Permanent Portfolio as a way…
Rob Arnott is the founder and chairman of the board of Research Affiliates — a giant in wealth management with $193 billion in assets under management. Research Affiliates is famous for publishing seminal research and investing based on that research….
William Bernstein is a former neurologist turned financial expert and writer. He believes, like many other successful investors, that index investing is better than selecting individual stocks and that how you allocate your assets is more crucial than choosing specific…
The Net-Net Value Investing Strategy, developed by Benjamin Graham and Warren Buffett, evaluates a company’s stock by considering its net current assets per share after adjusting for doubtful accounts and inventory values. Let’s find out how the net-net strategy works….
In a 2013 letter to Berkshire Hathaway investors, Buffett noted that, upon his passing, the trustee of his wife’s inheritance was instructed to put 90% of her money into a very low-fee stock index fund and 10% into short-term government…
What is the relationship between the unemployment rate and stock market returns? This is a somewhat confusing and not-so-straightforward relationship. Thus, in this article, we try to investigate the unemployment rate and subsequent stock market returns. Is the unemployment rate…
Would you like to know what the worst-performing group of stocks is? One certain type of stock has not made any money since JFK was president. That is 60 years. Yes, you read it right. 60 years! Any long-term mindset…
Peter Lynch is a famous but retired money manager. Lynch managed the Magellan Fund of Fidelity from 1977 to 1990 with outstanding returns: more than double the S&P 500’s return. Lynch made 29.2% annual returns for his investors and retired…
Today we will look at Meb Faber’s Global Asset Allocation portfolio from his book of the same name. The Global Asset Allocation portfolio is a passive investment strategy that aims to provide investors with a diversified exposure to global asset…
Asset allocation is the allocation of investments across different classes of assets. In a broad sense, this means a combination of stocks, bonds, various securities and money market instruments. Within these classes, subclasses are also distinguished: Risk and return The…
Paul Merriman is a financial advisor and has presented several low-cost “passive” investment strategies. One of them is Paul Merriman 4 Fund Portfolio. What is it, and how has it performed? Paul Merriman 4 Fund Portfolio is a simple investment…
SPY is the ETF for S&P 500 and GLD is the ETF for the gold price. Michael A. Gayed, CFA, presented a SPY/GLD rotation strategy on ritholtz.com in July 2011. SPY is the ETF for S&P 500 and GLD is…
The Merriman Ultimate Buy And Hold Portfolio by Paul Merriman aims to diversify investments as widely as possible across asset classes (bonds & stocks), countries, company size, and valuation. The goal is to have aa portfolio that achieves good risk-adjusted…
The Bernstein Coward’s Portfolio by Bill Bernstein aims to diversify investments as widely as possible across asset classes (bonds & stocks), countries, company size, and valuation. Bill Bernstein Coward’s Portfolio strategy can be implemented with only 9 ETFs, of which…
The Gibson Talmud Portfolio by Roger Gibson aims to diversify investments across US stocks, REITs and bonds. The Gibson Talmud Portfolio strategy can be implemented with only 3 ETFs, of which 33.34% are US stocks, 33.33% are US REITs and…
Albert Einstein is famous for saying that compounding is the eighth wonder. But is he correct? Yes, to a certain extent, he is correct. Look at the example below: Disclaimer Quantified Strategies (SIA Lofjord) is not an investment advisor. The…
The Clyatt Sandwich Portfolio made by Bob Clyatt aims to diversify investments across stocks, REITs, bonds, and cash. The Clyatt Sandwich Portfolio strategy can be implemented with 9 ETFs. You do not need to pick individual stocks and bonds. According…
The Coffeehouse Portfolio from Bill Schultheis aims to diversify investments across stocks, REITs, and bonds. The Schultheis Coffeehouse Portfolio strategy can be implemented with 9 ETFs. You do not need to pick individual stocks and bonds. Accordingly to our backtests…
Tyler’s Pinwheel Portfolio is a passive index portfolio that aims to diversify investments across stocks, REITs, bonds, gold and cash. The Pinwheel Portfolio strategy can be implemented with 8 ETFs. You do not need to pick individual stocks, bonds, REITs,…
The Second Grader’s Starter Portfolio by Paul Farrell is a passive index portfolio that aims to diversify investments across stocks and bonds. The Second Grader’s Starter Portfolio strategy can be implemented with only 3 ETFs. You do not need to…
In recent times, most investors prefer to invest using passive investment strategies with lazy portfolio management. Passive investing has “exploded” since the financial crisis in 2008/09, and part of this is due to the enormous growth of ETFs. Passive investing…
Are you tired of constantly monitoring the stock market and making emotional decisions that can hurt your portfolio’s performance? If so, then a quantitative investment strategy may be the solution for you. With the help of investment experts, this investment…
Many investors prefer to invest using passive investment strategies and “lazy” (but smart?) portfolio management. Increased knowledge, lower costs, and a rise in fund offerings (both ETFs and mutual funds) have contributed to this. Passive strategies include a popular asset…
Buy and hold has worked very well for long-term investors. History has also taught us that active money managers have underperformed S&P 500 or their benchmarks. We dream of becoming Warren Buffett, but most of us are below-average investors. Thus,…
Commodities are difficult to trade profitably, with few strategies offering any statistical edge. Despite this, finding effective commodities strategies might be worth the effort, as they allow for profits that are uncorrelated with those of other strategies and tend to…
Today we will introduce you to two main approaches to investing – passive vs. active investing strategy. An investor with a passive strategy will devote less time to the market and can increase capital at a pace in line with…
For many, owning a business or buying expensive real estate is out of the question. An alternative to growing your net worth over time is to invest in financial instruments such as stocks and bonds. In this article, we look…
The Core 4 Portfolio by Rick Ferri is a “lazy” index diversified investment portfolio that allocates assets across 3 asset classes: stocks, bonds, and REITs. These 3 asset classes are divided into 4 categories: U.S. stocks, international stocks, intermediate bonds,…
The 5 Asset Portfolio by Roger Gibson is a “lazy” index diversified portfolio that allocates assets across 4 asset classes: stocks, bonds, REITs, and commodities. These 4 asset classes are divided into 6 categories: U.S. stocks, international stocks, U.S. bonds,…
The Gone Fishin’ Portfolio by Alexander Green is a “lazy” index diversified portfolio that allocates assets across 4 asset classes: stocks, bonds, REITs and precious metals. These 4 asset classes are divided into 10 categories: U.S. Stocks, U.S. Small Cap…
The Simple Path to Wealth Portfolio by JL Collins is a “lazy” index diversified portfolio that allocates assets across two asset classes: stocks and bonds. These two asset classes are divided into two categories: U.S. stocks and U.S. bonds. Thus,…
You are going to learn about the 22 best investment strategies for 2024 in this detailed article. Learning different investment strategies is important for achieving financial success. Investors, who vary in their risk tolerance from conservative to aggressive, are on…
Throughout history, gold has consistently held its position as the preferred global currency. Now, investors primarily acquire gold as a safeguard against economic instability and, of course, inflation. How does gold perform when inflation is high? Gold has famously been considered…
The Seasonal Timing Strategy by Sy Harding is an active, but simple strategy that uses market timings and can be implemented using asset classes and portfolios. Using this strategy, you do not need to be in the market 100% of…
Let’s say you are a wealthy person who has already achieved FIRE (financial independence – retire early) and wants to preserve your wealth. It doesn’t matter what strategy or portfolio you used to achieve wealth because it requires completely different…
What Are the Best Asset Classes to Get Rich? To become rich, you will need to choose a portfolio that will generate the highest possible return with the lowest potential risk. Imagine that you are a poor person who wants…
There are many ways investors try to determine if the stock market is overvalued or not. Some people rely on technical indicators to gauge whether the market is overextended or overbought, while others employ valuation measures like the P/E ratio,…
The relationship between interest rates and stocks is crucial to understand if you are investing in the stock or bond market. How does the S&P 500 perform when interest rates are rising? Interest rates and the stock market have an…
Imagine what it would be like to have invested $100 in the stock market in 1928 and held on to it until today. What’s the growth of $100 invested in 1928? $100 invested in the stock market in 1928 would be…
The majority of investors think long-term. For instance, most US households, excluding the wealthiest 1%, predominantly keep their stocks, bonds, and bills in retirement portfolios. In fact, those not in the top 1% or even 10% of wealth distribution have…
Stocks can be classified into four factors: value, size, investment, and quality. It is well-known that value stocks perform well, and small caps tend to outperform large caps. However, what about the quality factor trading strategy? The quality factor can…
Factor investing targets securities with specific characteristics, called factors, that have historically been associated with higher expected returns. Common factors include value, quality, momentum, size, and minimum volatility. Factor investing is a strategy that uses various attributes of securities, such…
Warren Buffett is for some considered the best investor of all time. Among his many lessons and contributions to the world of finance, one that stands out is the Warren Buffett indicator. This indicator is a measure of valuation for…
After a positive year for stocks, S&P 500 tend to rise 6.75% the next year, not including dividends. If the S&P 500 drops one year, the next year return is on average 12.1%. After a good year in the stock…
What is the optimal asset diversification historically? This is debated, but we came across an interesting study that looks at the best historical asset class diversification models over the last 100 years, all based on statistics and backtests. The main…
I have just finished reading When Genius Failed by Roger Lowenstein. The book is an unauthorized biography of the rise and fall of Long-Term Capital Management (LTCM). For those who are not aware of this incredible story, here is a…
I have just reread Henry Hazlitt’s Economics In One Lesson, published in 1946. This very good, but short book, is about basic economics. This book should be mandatory in every public school. It takes about 2-3 hours to read and…
I believe it’s much more useful to read good books twice than pouring over many books. In this brief article, I explain why you should read good books twice (or rereading multiple times). About one year ago, I moved from…
This weekend I reread The Checklist Manifesto, a book published in 2010, which argues the case for a systematic approach to our daily work as professionals. Below you find arguments for why I believe a checklist is a logical part…
I believe Buffet’s annual letters are an invaluable source of investment knowledge and advice. I recently reread all of them and Lawrence Cunningham’s The Essays Of Warren Buffett – Lessons For Investors And Managers, a book containing excerpts from all…
I guess most readers of my website have read books by management gurus like Jim Collins and Tom Peters, and many more have probably studied Micheal Porter’s Competitive Strategy. But the “problem” with the business theory is that it’s solely…
Morgan Housel has written a short and powerful book about personal finance called The Psychology Of Money – Timeless Lessons On Wealth, Greed, And Happiness. The book might not be related to trading, but personal finance should be a topic…
We believe the best way to learn to trade is by backtesting and trial and error, but you can get valuable input from traders who have been successful. This post is a collection of some of the top motivational trading…
Joe Ritchie was an American investor and Options and Commodities trader that passed away in 2022. He founded Chicago Research and Trading (CRT), a quantitative investment firm, in 1977 and served as the head of Fox Rivers Partners. He later…
Mark D. Cook is an American trader and investor. but is mostly famous for being interviewed in Jack Schwager’s Stock Market Wizards. He worked from his family’s 1870s farmhouse located in East Sparta, Ohio, where he manages his own account….
Mark Minervini is an acclaimed author, technical analyst, instructor, independent trader, and the Founder of Quantech Fund, LP. He has more than three decades of experience in finance and was featured in Jack Schwager’s Stock Market Wizards; conversations with American…
Mark Ritchie is an American investor with over twenty years of experience in the financial industry. He was a Chicago Board of Trade and Chicago Mercantile Exchange Commodities trader. He was one of the original co-founders of Chicago Research and…
Micheal Lauer reluctantly said yes to be interviewed in Jack Schwager’s Stock Market Wizards. Why? Because he didn’t feel he deserved it because his track record was only seven years. However, in those seven years, he managed 72% annual returns…
Monroe Trout is an American investor and hedge fund manager. He was interviewed in the New Market Wizards by Jack Schwager. This article looks briefly at Monroe Trout’s early life and his life as a trader. We end the article…
Michael Masters is an Atlanta-based fund manager. This article looks briefly at Micheal Masters’ early life and his trading career. We end the article by some quotes from his interview in Jack Schwager’s Stock Market Wizard. Micheal Masters’ trading career:…
Ahmet Okumus is a money manager. He began trading in 1992 with $15,000 from his mother. And by 2000, he had turned that into $6 million, that’s an average annual return of 107%. He founded his hedge fund — the…
William Eckhardt is an American investor, commodities and futures trader, and fund manager. Eckhardt was one of the pioneers of quantified and mathematical trading and used some of the theories that later were popularized by Nassim Nicholas Taleb. William Eckhardt…
Lucius Annaeus Seneca, better known as Seneca, was born in Cordoba, Roman Spain, in 4 BC and died in 65 AD. He grew up in Rome as a son of a procurator who was an authority in rhetoric, public speaking…
Poker, Sex and Dying is the title of a book by Juel Anderson published some time in the early 1980s. Some years after publication it was out of print and somewhat forgotten, but accidentally option investor David Caplan found a…
I currently reread Victor Niederhoffer’s The Eduction of A Speculator. I regard this book as one of the best I have ever read. It’s not an easy read, but it completely changed my mindset for the better 20 years ago….
Who are the most successful traders of all time? Your quest leads to icons like George Soros, Jesse Livermore, and more, who have transcended the mere act of trading to become pillars of financial history. Discover the fearless decisions and…
The last trading day of the month offers trading opportunities. This is one of many seasonal trading strategies. Can we make a last trading day of the month trading strategy? The last trading day of the month is a weak…
