Strategies

What's the key to making good investment choices? It isn't necessary to understand the inner workings of the securities markets or the mathematical economies underlying investment theory. Instead, 10 axioms of effective investing provide the critical cornerstone for guiding investment philosophy and making decisions. [Here they are.] Words: 2155

Nobody can predict what the stock market will do so basing your investment decision on market or economic predictions is a fool’s game.

Warren Buffett likes to counsel individual investors to buy-and-hold (specifically, buy an equity index fund and hold it forever). This is a perfect example of “do as I say, not as I do,” as Buffett has successfully timed the market for decades and, [interestingly,] Buffett is now carrying his largest cash position ever in stark contrast to individual investors who now hold their smallest cash positions since the height of the internet bubble. Clearly, he’s timing once again and I’m sure a few of you are wondering just how he manages to do this so successfully. [Let me explain.]

Cognitive biases plague us and make it difficult for us undertake adequate analysis and make good choices so knowing about them is imperative if we are going to deal with them. This article identifies 10 such biases and how they impede us making the right investment choices.

There is a crucial component of the investment process that gets surprisingly little attention: our investment default settings. We can use them when we aren’t sure what to do, when we’re deciding what to do, when our circumstances have changed but our plan hasn’t (yet), or when we’re just starting out. Here they are.

Most “home run” investments evolve over time. Rarely do they happen overnight. Investors have to put themselves in the right position to “get home” by getting off to a good start with the investment to begin with. This, along with a little luck, dramatically increases the chance of a big winner. Here are 7 recurring themes to such “home run” style investing. Words: 640

There are many indicators available that provide information on stock and index movement to help you time the market and make money. Market strength and volatility are two such categories of indicators and a description of six of them are described in this "cut and save" article. Read on!

Here’s my list of the most common errors investors make and some related maxims.

Yes, you can time the market! Assessing the relative levels of greed and fear in the market at any given point in time is an effective way of doing so and this article outlines the 6 most popular momentum indicators and explains how, why and where they should be used.

Which types of investment behavior are most associated with negative returns and to what degree? This article isolates 2 specific bad behaviors that hurt investor returns most and recommends how such shortcomings can easily be avoided.