Several years ago, an investment-manager friend told me about the thirty-second rule. It’s a powerful (yet remarkably simple) way to think about investment analysis — one that has stuck with me ever since that initial conversation. “When you look at any investment,” he said, “you should know if it works within thirty seconds or less.” At first I was skeptical. This sounded more like getting a psychic reading than a sound strategy for investing. But — as he went on to explain — there’s actually a lot to be said for first impressions, whether it’s for people or stocks. Here’s… Read More

Several years ago, an investment-manager friend told me about the thirty-second rule. It’s a powerful (yet remarkably simple) way to think about investment analysis — one that has stuck with me ever since that initial conversation. “When you look at any investment,” he said, “you should know if it works within thirty seconds or less.” At first I was skeptical. This sounded more like getting a psychic reading than a sound strategy for investing. But — as he went on to explain — there’s actually a lot to be said for first impressions, whether it’s for people or stocks. Here’s how his rule works. Basically, you divide potential investments into three groups. The first group consists of ideas that clearly don’t work. These have an obvious flaw. My friend estimated this amounts to about 5% of all the investment pitches out there. These are the ones we instantly reject. The next group of potential investments is the “in-betweens.” My friend theorized that most investments out there fall into this category. As the name suggests, these ideas are all plausible. To varying degrees, they have good points and weaker points. But none of them is so strong that it jumps out… Read More

What do you do when you find a stock that absolutely dominates its industry… pays steadily rising dividends year after year… and trades at a 43% discount to the S&P 500? You buy it and hold it forever. I’m not the only one who thinks so either. Many of America’s wealthiest and most well-connected investors will back me up on that. They would know… they’ve been stuffing billions of dollars into stocks like this for more than a decade now. Let me give you an example. According to Berkshire Hathaway’s most recent annual report, Warren Buffett’s company now owns more… Read More

What do you do when you find a stock that absolutely dominates its industry… pays steadily rising dividends year after year… and trades at a 43% discount to the S&P 500? You buy it and hold it forever. I’m not the only one who thinks so either. Many of America’s wealthiest and most well-connected investors will back me up on that. They would know… they’ve been stuffing billions of dollars into stocks like this for more than a decade now. Let me give you an example. According to Berkshire Hathaway’s most recent annual report, Warren Buffett’s company now owns more than 483 million shares of banking giant Wells Fargo (NYSE: WFC). The total stake is worth upwards of $10 billion. That’s a long way from his initial $290 million investment in the company back in 1990. And he’s not the only well-connected investor who loves Wells Fargo either. In fact, you may not be aware of it, but average American investors are actually able to see what stocks are owned by their Congressional representatives. Why is this important? Well, a recent study found that members of the House of Representatives beat the average stock market investor by 6.8% per year. Read More

If you’re starting to get nervous about the stock market, I don’t blame you. Volatility is hitting record levels we haven’t seen in 25 years. Growth is slowing across the globe. The market is delivering one of its worst performances in years. But despite all these forces converging, you still have the chance to make once-in-a-decade gains, thanks to a time-honored StreetAuthority tradition. I’m talking about the latest edition of our annual report: “Top 10 Stocks for 2016.” Without a doubt, this is our most anticipated piece of research each year.  My staff and I… Read More

If you’re starting to get nervous about the stock market, I don’t blame you. Volatility is hitting record levels we haven’t seen in 25 years. Growth is slowing across the globe. The market is delivering one of its worst performances in years. But despite all these forces converging, you still have the chance to make once-in-a-decade gains, thanks to a time-honored StreetAuthority tradition. I’m talking about the latest edition of our annual report: “Top 10 Stocks for 2016.” Without a doubt, this is our most anticipated piece of research each year.  My staff and I have spent the past few months on this project, and it wasn’t cheap. I calculate the total cost of gathering, analyzing and distributing this data will come to more than $250,000. And we take a big risk in publishing it. There are no take-backs with this report. Once it’s published, we’re locked in for the year. If we make bad calls, we know investors will remember it. That means when we publish them for everyone to see, we’re putting ourselves out on a limb in a big way.  So far, that risk has paid off every… Read More

If you’ve read my premium advisory Top 10 Stocks for any length of time, then you know I like to focus on companies that dominate their markets, that provide a product or service essential to daily life, and that return the bulk of their cash to shareholders in the form of dividends and share buybacks. As I’ve mentioned countless times, these core attributes are what form the basis of what I call “Forever” stocks. These are the types of companies that you can buy today and hold for the rest of your life. Put simply, “Forever” stocks are some of… Read More

If you’ve read my premium advisory Top 10 Stocks for any length of time, then you know I like to focus on companies that dominate their markets, that provide a product or service essential to daily life, and that return the bulk of their cash to shareholders in the form of dividends and share buybacks. As I’ve mentioned countless times, these core attributes are what form the basis of what I call “Forever” stocks. These are the types of companies that you can buy today and hold for the rest of your life. Put simply, “Forever” stocks are some of the world’s greatest businesses. And once you know what to look for, it’s easy to spot these sorts of companies (and to quickly see which businesses don’t fit the mold). Want some insights into what I look for in a stock? Here are 12 important things I look for when searching for the world’s greatest businesses. I urge you to print out this list. Put it next to your computer and refer to it before you buy any stock. There’s little doubt it will make you a better investor. 1.) The world’s greatest businesses sell their products at premium prices. Read More

In 2009, Apple coined the phrase “There’s an app for that,” in a marketing campaign touting the iPhone 3. The phrase is still commonly quoted. It was a hands-down advertising victory for the tech giant. Six years later, I’d propose a similar claim, pertaining to the investing world. “There’s an expert for that.” In today’s financial climate, filled to the brim with talking heads, round-the-clock financial news and thousands of “expert picks,” nearly anyone could justify nearly any investing decision. Think it’s time to buy small caps? So does one expert. Think it’s time to sell them? So does a… Read More

In 2009, Apple coined the phrase “There’s an app for that,” in a marketing campaign touting the iPhone 3. The phrase is still commonly quoted. It was a hands-down advertising victory for the tech giant. Six years later, I’d propose a similar claim, pertaining to the investing world. “There’s an expert for that.” In today’s financial climate, filled to the brim with talking heads, round-the-clock financial news and thousands of “expert picks,” nearly anyone could justify nearly any investing decision. Think it’s time to buy small caps? So does one expert. Think it’s time to sell them? So does a different expert. Think Wall Street is just an intergalactic conspiracy being run by aliens? There’s an expert for that. But despite all the fanfare, fancy haircuts and retroactive “I told you so” claims, do you know the one thing these “experts” have never seen coming? The largest booms in American history. The baby boom is a perfect example. The world’s economy had just been devastated by WWII. We’d just picked up the tab to rebuild Europe with the Marshall Plan, giving us more post-war debt than our total GDP. Factories all over were closing down as they stopped producing war… Read More

Many people have written America off. They think our best days are over.  Conventional wisdom says that American industry is “over the hill.” Many observers today believe that U.S. firms simply can’t compete with the likes of the emerging Chinese and Brazilian markets. It’s certainly true that on a basic scale, those economies are growing faster. America’s 1.9% GDP growth last year doesn’t come close to China’s 7.7%. And from ballooning government debt to prolonged conflict overseas to scandalous behavior on Wall Street, it’s easy to think that these talking heads might be on to something. But nothing could be… Read More

Many people have written America off. They think our best days are over.  Conventional wisdom says that American industry is “over the hill.” Many observers today believe that U.S. firms simply can’t compete with the likes of the emerging Chinese and Brazilian markets. It’s certainly true that on a basic scale, those economies are growing faster. America’s 1.9% GDP growth last year doesn’t come close to China’s 7.7%. And from ballooning government debt to prolonged conflict overseas to scandalous behavior on Wall Street, it’s easy to think that these talking heads might be on to something. But nothing could be further from the truth.  Sure, America has its problems. There’s no denying that. But if you look a little deeper, you’ll find that there’s one area — perhaps the most important area — where America still firmly leads the globe. I’m talking about innovation. You see, a mounting pile of evidence suggests we’re entering an industrial renaissance that will once again jumpstart the U.S. economy and bring the nation back to the industrial giant it once was.  The U.S. Still Dominates Innovation Perhaps the greatest testament to the rebirth of the American economy is how innovation emerges in so… Read More

The truth will make you sick. Technically it’s public knowledge, but I can tell you — it’s Congress’ dirty little secret. Congress is rich. Unbelievably rich. And until just recently, insider trading laws didn’t apply to Congress. I don’t know which is worse: The fact that insider trading was legal for some of our nation’s wealthiest politicians… or that Congress refused to do anything about it for decades. That was, the legislation languished until 60 Minutes — one of the most-respected investigative journalism programs on television — dedicated a segment to the issue. Among their findings: Nancy Pelosi (D-CA) and… Read More

The truth will make you sick. Technically it’s public knowledge, but I can tell you — it’s Congress’ dirty little secret. Congress is rich. Unbelievably rich. And until just recently, insider trading laws didn’t apply to Congress. I don’t know which is worse: The fact that insider trading was legal for some of our nation’s wealthiest politicians… or that Congress refused to do anything about it for decades. That was, the legislation languished until 60 Minutes — one of the most-respected investigative journalism programs on television — dedicated a segment to the issue. Among their findings: Nancy Pelosi (D-CA) and her husband have participated in multiple exclusive IPOs — including that of Visa. According to one report, Pelosi purchased 5,000 shares of Visa at the IPO price of $44. Just a couple of days later, when the stock was trading to the investing public, it traded at $64 per share.  John Boehner (R-OH) bought shares of healthcare companies days before the “public option” was pulled from the recent Obamacare legislation. The removal of the public option proved to be a boon for private health insurers, making a significant sum for the Congressman’s investments. The report from 60 Minutes led to… Read More

It’s that time again — when nervous investors flee the market, and seasoned stock buyers look to make bigger profits. As I write this, the Dow Jones Industrial Average is nearly 900 points lower than it was at the beginning of August. That’s almost a 5% decline. The Nasdaq, meanwhile, has dropped more than 4%.  What a difference a month makes.  These moves were spurred by a global drop in stocks that saw markets like China, Hong Kong and Australia all fall significantly. The financial press is of course buzzing. Many observers are saying this is the start of a… Read More

It’s that time again — when nervous investors flee the market, and seasoned stock buyers look to make bigger profits. As I write this, the Dow Jones Industrial Average is nearly 900 points lower than it was at the beginning of August. That’s almost a 5% decline. The Nasdaq, meanwhile, has dropped more than 4%.  What a difference a month makes.  These moves were spurred by a global drop in stocks that saw markets like China, Hong Kong and Australia all fall significantly. The financial press is of course buzzing. Many observers are saying this is the start of a bear market, the beginning of the end for stocks, etc., etc. It’s times like these when it’s great to own a “Forever” stock. As I’ve discussed many times, the idea of Forever stocks is simple: as an investor, you want to buy great businesses that can be held for months, years, even decades, without worry. This theme is central to my premium newsletter, Top 10 Stocks. And it never ceases to amaze me that no matter how simple this idea sounds, so few investors actually follow it during good times, let alone periods of market volatility. Just consider the history… Read More

Call it American ingenuity, but the things we come up with are inevitably sought after by people in nearly every corner of the world. Even where the governments don’t like us — like in Russia and Iran. This has occurred throughout much of U.S. history. The list is endless: the cotton gin, the telegraph, the telephone, the light bulb, the airplane. You get the picture. #-ad_banner-#I’m not saying this to be patriotic. I say it to remind you that we have something unique in this country that’s helped us out of every economic mess we’ve found ourselves in. In fact,… Read More

Call it American ingenuity, but the things we come up with are inevitably sought after by people in nearly every corner of the world. Even where the governments don’t like us — like in Russia and Iran. This has occurred throughout much of U.S. history. The list is endless: the cotton gin, the telegraph, the telephone, the light bulb, the airplane. You get the picture. #-ad_banner-#I’m not saying this to be patriotic. I say it to remind you that we have something unique in this country that’s helped us out of every economic mess we’ve found ourselves in. In fact, nearly every time our economy has looked down and out, we’ve turned things around. And no one ever seems to see it coming. Take the baby boom for example. The world’s economy had just been devastated by WWII. We’d just picked up the tab to rebuild Europe, thrusting ourselves into crushing post-war debt totaling more than our nation’s GDP. And to make things worse, most American families were struggling just to return to normal life. Factories closed as they stopped producing war goods, and unemployment doubled as 10 million soldiers returned home. In fact, a year after the war, the… Read More

Everyone makes mistakes, especially when it comes to investing. Some errors simply come with the territory. Others are so detrimental they could be costing you upward of three, eight, even as much as 21 times the returns you would have earned by not making them. Today’s essay is dedicated to identifying two of the deadliest investing mistakes you might not know you’re making. #-ad_banner-# Mistake #1: Growth stocks are not the fastest or safest way to grow your retirement. Ask ten investors the best way to grow your wealth in the… Read More

Everyone makes mistakes, especially when it comes to investing. Some errors simply come with the territory. Others are so detrimental they could be costing you upward of three, eight, even as much as 21 times the returns you would have earned by not making them. Today’s essay is dedicated to identifying two of the deadliest investing mistakes you might not know you’re making. #-ad_banner-# Mistake #1: Growth stocks are not the fastest or safest way to grow your retirement. Ask ten investors the best way to grow your wealth in the stock market, and I’m willing to bet nine of them will tell you the answer is long-term growth stocks. After all, growth stocks are plowing their cash back into the company, so surely they must be growing faster, right? Wrong. The truth is that dividend stocks — not growth stocks — have proven to be the best tools for building a robust nest egg. Not only have dividend stocks grown faster over time, they’ve also shown considerably more resilience in bear markets than growth stocks. In fact, Ned… Read More