Investment Journal

I am not an investment adviser. Nothing in this post is meant to be interpreted as investment advice. Here are some market caps of auto manufacturers. Tesla Motors : 24B General Motors : 59B Ford : 64B BMW : 74B Daimler AG : 101B (manufacturer of Mercedes, plus some other things; a business built on manufacturing luxury cars that gets revenues from other places too) Toyota : 239B The first thing I notice on this list is that Ford and GM have practically identical market caps even though one of them has utterly failed as a business recently and was revamped by the government which doesn't typically do a good job of managing assets. The market seems to be valuing these two companies more on the fact that they have approximately equivalent brand appeal, approximately equivalent market saturation, and approximately equivalent markets than it does based on their prior performance as businesses. I don't know if this is smart, but it doesn't seem particularly wise to me...

This post simply consists of commentary. I am not a market adviser. NOTHING IN THIS POST IS INTENDED AS INVESTMENT ADVICE. The first number I was taught about when I started learning a little bit about investing was P/E. A lot of the most insightful commentaries I read about the market focus primarily on cash flows. Most of the seminars I see catering to regular investors really like dividends. Some of the hot metrics right now that seem to be getting a lot of attention are insider ownership, insider buying, and insider selling. Something that professional traders like to talk about is days to cover, but one number I never really hear anybody talk about is market cap. This is a crying shame. Market cap is simple to understand and even easier to overlook. (It's just the total value  Some investors use market cap to sort portfolios into small cap, mid cap, and large cap stock, but other than that, people pretty much ignore it as a source of information about a stock, even...

This post simply consists of commentary. I am not a market adviser. NOTHING IN THIS POST IS INTENDED AS INVESTMENT ADVICE. In this post, I will lay out the simplest strategy I can devise to outperform the S&P 500. Since picking stocks is anything but simple, I will not make this strategy a stock picking strategy. Instead it will be a market exit and re-entry strategy for investments kept at market weight in the S&P 500. Timing exit and re-entry is itself complicated, and not something that someone can do with a lot of confidence. So instead of looking for a way to completely exit and re-enter the market, I'll talk about reducing a position and strengthening it again. If you're willing to go with an empirical strategy as opposed to one with more of a theoretical justification. Looking at the 100 period exponential moving average has actually been a remarkably accurate predictor of stock market collapse. Sell as soon as  the market crosses below, buy when the market c...