Finding high dividend yields has become difficult. Income investors are often forced into accepting low returns or taking on excessive risk in sketchy stocks and junk grade bonds. It seems every high-yielding investment has a corresponding unacceptable risk level in today’s low rate environment. Fortunately, there is a solution for income investors. #-ad_banner-#Earning 6%-plus yields in an investment considered to be safer than common stock is possible. Here’s how: If you have not already guessed it, I am referencing preferred stock. Many investors are not aware of the benefits of preferred stock or even what it is. This article will… Read More

Finding high dividend yields has become difficult. Income investors are often forced into accepting low returns or taking on excessive risk in sketchy stocks and junk grade bonds. It seems every high-yielding investment has a corresponding unacceptable risk level in today’s low rate environment. Fortunately, there is a solution for income investors. #-ad_banner-#Earning 6%-plus yields in an investment considered to be safer than common stock is possible. Here’s how: If you have not already guessed it, I am referencing preferred stock. Many investors are not aware of the benefits of preferred stock or even what it is. This article will explain preferred stock and reveal five stocks are creating 6% and more excellent dividend yields. The two classes of stock are common and preferred. Both categories carry an ownership interest in the company, but that is where the similarities end. The primary difference is that common stockholders usually have voting rights for the company’s decisions while preferred stockholders may or may not have the right to vote. An excellent way to think about the preferred stock is that it is similar to a bond. Preferred stockholders have a stronger right to the company’s assets, earnings, and dividends than common stockholders. Read More

I struggled to write this article since I love Tesla’s cars and genuinely want to believe in Elon’s vision.   I am an automobile fanatic, having owned multiple sports cars and other vehicles, so I am speaking from experience when I say I was blown away by the performance, handling, and ergonomics of the Model S. The jump from 0-100 MPH was breathtaking at under 5 seconds thanks to the silent explosive electric power.   #-ad_banner-#Investors have been crazy over the stock for the last five years.  I can’t say I blame them, with shares returning over 400% compared to… Read More

I struggled to write this article since I love Tesla’s cars and genuinely want to believe in Elon’s vision.   I am an automobile fanatic, having owned multiple sports cars and other vehicles, so I am speaking from experience when I say I was blown away by the performance, handling, and ergonomics of the Model S. The jump from 0-100 MPH was breathtaking at under 5 seconds thanks to the silent explosive electric power.   #-ad_banner-#Investors have been crazy over the stock for the last five years.  I can’t say I blame them, with shares returning over 400% compared to the S&P 500’s return of 66% during the same time frame. But no matter how much I want to embrace the stock, it no longer makes sense. Remaining objective is a crucial trait for successful investors, and after researching Tesla, the shares remain extremely overvalued. The stock is trading lower by around 8% this year, and I expect further downside over the next 18 months. Here are five reasons to short Tesla now: 1. The Fundamental Metrics Stocks are anticipatory mechanisms, meaning they are priced based on expected performance. In Tesla’s case, the current standard fundamental metrics are so… Read More

Cryptocurrency bears have had a field day since the price plunge. Every social media platform and even mainstream news services have been overrun with negative commentary as cryptocurrencies gave back 50% or more of their gains over the last few months. #-ad_banner-#Even the mighty bitcoin nosedived from nearly $20,000 per coin to around $6,300 per coin in just a few weeks.  During the price crash, even avid crypto bulls started to question the wisdom of holding onto newly their minted wealth.   What’s Going On? Being such a young market, there is genuinely no history to determine what is… Read More

Cryptocurrency bears have had a field day since the price plunge. Every social media platform and even mainstream news services have been overrun with negative commentary as cryptocurrencies gave back 50% or more of their gains over the last few months. #-ad_banner-#Even the mighty bitcoin nosedived from nearly $20,000 per coin to around $6,300 per coin in just a few weeks.  During the price crash, even avid crypto bulls started to question the wisdom of holding onto newly their minted wealth.   What’s Going On? Being such a young market, there is genuinely no history to determine what is normal and what is abnormal price behavior. One thing is for sure:  volatility is the nature of the beast. The millions of new traders who entered the market during the massive uptrend loved the volatility when it was making 12-year-olds millionaires in a matter of months. However, once the volatility turned the tables on the bullish masses, all the noobs panicked, declaring that the bubble had burst. Fueled by the sensation-seeking media machines, the panic selling resulted in downside volatility soaring and prices plummeting. At the same time, those who understand how markets really work waited patiently for the ideal… Read More

Buying beat down stocks is a time-honored way to earn significant returns in the stock market. However, the question is always the same: Which stocks are worth buying and which aren’t? #-ad_banner-#Here are five of the most prominent losing stocks of 2018, along with my thoughts on which ones to buy and which to avoid or short. 1. L Brands (NYSE: LB) This female-focused retailer is leading the retail apocalypse. Shares have been crushed this year by plunging over 40% in the last four months.  Already suffering from the overall retail malaise, L Brands exasperated the downside by issuing… Read More

Buying beat down stocks is a time-honored way to earn significant returns in the stock market. However, the question is always the same: Which stocks are worth buying and which aren’t? #-ad_banner-#Here are five of the most prominent losing stocks of 2018, along with my thoughts on which ones to buy and which to avoid or short. 1. L Brands (NYSE: LB) This female-focused retailer is leading the retail apocalypse. Shares have been crushed this year by plunging over 40% in the last four months.  Already suffering from the overall retail malaise, L Brands exasperated the downside by issuing weak guidance at the end of 2017. Combined with analyst downgrades, the stock only collapsed under the pressure.   However, it appears that the worst is over for the $10 billion market cap company. Here’s why: Best known via its consumer-facing brand stores Victoria’s Secret, PINK, Bath & Body Works, La Senza and Henri Bendel, the company operates 3,067 specialty stores in the United States, Canada, the United Kingdom and Greater China, and its brands are sold in more than 800 additional franchised locations worldwide.   Boasting nearly $13 billion in annual revenue, bullish signals are starting to emerge. In… Read More

Many long-term investors are sitting on handsome winnings from the massive bull market of the last several years. Nearly everyone was riding high on bullish enthusiasm, and nothing seemed to go wrong. Investors were successfully buying dips as the stock market pushed to record high after record high. It was an actual golden age from the stock market to cryptocurrencies, as even beginners basked in sometimes steady and sometimes obscene profits. #-ad_banner-#Then the impossible happened — stocks started falling fast as investors scrambled to lock in profits by liquidating their holdings. While taking profits is always a smart move, it’s… Read More

Many long-term investors are sitting on handsome winnings from the massive bull market of the last several years. Nearly everyone was riding high on bullish enthusiasm, and nothing seemed to go wrong. Investors were successfully buying dips as the stock market pushed to record high after record high. It was an actual golden age from the stock market to cryptocurrencies, as even beginners basked in sometimes steady and sometimes obscene profits. #-ad_banner-#Then the impossible happened — stocks started falling fast as investors scrambled to lock in profits by liquidating their holdings. While taking profits is always a smart move, it’s hard to not think about what would have happened had you held your shares. The prevailing wisdom is that you can always buy back your stocks after taking profits. Of course, this makes sense, but it is tremendously challenging to execute. My hat is off to you should you not struggle to buy back at a lower price after selling. On the other hand, professional stock traders and investment firms often hedge their long positions rather than selling to protect their gains. A well-managed hedge can protect your profits while allowing for upside potential in the stock. Here are three… Read More

Learning to listen to the market is a crucial investment skill. The stock market will tell you what to do if you know what to listen for. The following five things are what the market is saying right now. 1. Volatility Is Here To Stay Short-term traders rejoice! After years of ultra-low VIX readings, volatility is finally back. Spiking into the 50 zone during the February stock market chaos, the VIX has stayed above its 200-week simple moving average (SMA). #-ad_banner-#The surging VIX has resulted in more than a few hedge funds and other money managers throwing in the… Read More

Learning to listen to the market is a crucial investment skill. The stock market will tell you what to do if you know what to listen for. The following five things are what the market is saying right now. 1. Volatility Is Here To Stay Short-term traders rejoice! After years of ultra-low VIX readings, volatility is finally back. Spiking into the 50 zone during the February stock market chaos, the VIX has stayed above its 200-week simple moving average (SMA). #-ad_banner-#The surging VIX has resulted in more than a few hedge funds and other money managers throwing in the towel as their “bread & butter” short-trade volatility blew up in their faces. At the same time, long-suffering bullish volatility players are being rewarded handsomely for their patience. In fact, one Denver-based hedge fund, Ibex Investors, managed to turn a $200,000 trade into over $17 million during the explosive move. Although the VIX has dropped since the 2018 highs, I have little doubt that we can expect additional spikes and continual relatively high volatility over the next few years. The reason for my long volatility thesis is the fact that politically, economically, and socially, the global structure is being thrown… Read More

There are very few edges left in the stock market. The tremendous amount of money, talent, and strategies combined to create a nearly efficient market that is exceedingly difficult to beat consistently. Add in structural changes like tightening spreads, decimalization, and high-frequency trading machines, and the stock market becomes a formidable foe for even the most sophisticated investor. The good news is that there are several edges still available for the retail investor. Yes, the market can still be beat! #-ad_banner-#Choosing and holding the right stocks for the long term is the primary way to beat the market. All the… Read More

There are very few edges left in the stock market. The tremendous amount of money, talent, and strategies combined to create a nearly efficient market that is exceedingly difficult to beat consistently. Add in structural changes like tightening spreads, decimalization, and high-frequency trading machines, and the stock market becomes a formidable foe for even the most sophisticated investor. The good news is that there are several edges still available for the retail investor. Yes, the market can still be beat! #-ad_banner-#Choosing and holding the right stocks for the long term is the primary way to beat the market. All the short-term gaming and manipulation do not affect long-term stock market investors. The trick is choosing the right stocks. Skill in stock picking remains a potent edge in the very efficient stock market of the 21st century. One of my favorite ways to pick stocks for my account is by following the insiders. Insiders are anyone who has access to non-public, stock-moving information about a company. They can be corporate directors, officers, or even lawyers and accountants who are working with the company. It’s just not my experience that supports an edge in following insider buys. Several academic studies support the… Read More

I’ll admit I am getting apprehensive about the stock market. I’ve long been a super-bull, but the last several weeks have started to change my long-term bias. I do not like what I am witnessing on a day-to-day basis in the stock market. Stocks are definitely showing signs of topping out. Surging volatility — fueled by trade war fears and surprise interest rate spike jitters — has investors very concerned about the future. #-ad_banner-#Despite stocks not being in an official bear market (defined as a 20% drop from the highs), price action is indicating greater bearishness may be right around… Read More

I’ll admit I am getting apprehensive about the stock market. I’ve long been a super-bull, but the last several weeks have started to change my long-term bias. I do not like what I am witnessing on a day-to-day basis in the stock market. Stocks are definitely showing signs of topping out. Surging volatility — fueled by trade war fears and surprise interest rate spike jitters — has investors very concerned about the future. #-ad_banner-#Despite stocks not being in an official bear market (defined as a 20% drop from the highs), price action is indicating greater bearishness may be right around the corner. I know it may sound like an oxymoron, but during bearish periods, bullish price spikes are more common than during bull markets. The market uses these spikes to attract the last vestiges of long-only capital before a precipitous plunge. Recent price moves are indicative of this time-proven warning. Another apparent bearish cue is the daily price range of the Dow Jones Industrial Average. The best way to illustrate the phenomenon is to take a look at the daily price chart for the DJIA. Note the tight daily range during the move higher. The steady uptrend exhibits… Read More

Trump’s tariff talk has thrown stocks into disarray. No one knows just how this new twist will play out in the economy. It appears to be a safe bet that whatever happens, it will not be bullish for stocks. #-ad_banner-#Long-term investors have a choice to ride out the volatility or take action to attempt to increase profits during the uncertainty. Should you decide to actively invest during these volatile times, here are three ways to make the difficult times work for you. 1. Get Long The VIX Hedge funds and professional traders were thrown for a loop in February… Read More

Trump’s tariff talk has thrown stocks into disarray. No one knows just how this new twist will play out in the economy. It appears to be a safe bet that whatever happens, it will not be bullish for stocks. #-ad_banner-#Long-term investors have a choice to ride out the volatility or take action to attempt to increase profits during the uncertainty. Should you decide to actively invest during these volatile times, here are three ways to make the difficult times work for you. 1. Get Long The VIX Hedge funds and professional traders were thrown for a loop in February as the time-proven short VIX trade blew up. Over the last several years, a significant source of alpha for derivative traders and longer-term investors was short volatility. As long as volatility declined or stayed stable, short biased option strategies and just outright short trades created profits month after month. Then Trump’s tariff talk combined with the regime of climbing rates sent the market to the loony bin. The VIX spiked and stocks plunged, calling the bluff of everyone but the most seasoned investors. While no one knows what the future holds, my bet is the VIX is going to climb… Read More

Is it time to start taking a defensive posture in your long-term stock portfolio? My answer is an unequivocal “YES!” Here’s why: The stock market has plunged and soared — both by 660-plus-points — with a major dip in February and a surge earlier this week. Battered by devastating news of trade wars and tariffs while buoyed by massive tax reform and surging economy, the market has gone psychotic. #-ad_banner-#The volatility may be signaling the end of the bull market. Despite the mind-blowing longer-term uptrend, the Dow Jones Industrial Average is down around 2% in 2018. … Read More

Is it time to start taking a defensive posture in your long-term stock portfolio? My answer is an unequivocal “YES!” Here’s why: The stock market has plunged and soared — both by 660-plus-points — with a major dip in February and a surge earlier this week. Battered by devastating news of trade wars and tariffs while buoyed by massive tax reform and surging economy, the market has gone psychotic. #-ad_banner-#The volatility may be signaling the end of the bull market. Despite the mind-blowing longer-term uptrend, the Dow Jones Industrial Average is down around 2% in 2018.  Dow theorists are exclaiming that the bearish Dow Theory signals are incredibly close to firing. Also, extreme volatility, which the market has seen this year, often signals a major market turn. Remember, it takes a 20% decline from the highs in the major averages to define a bear market. Smart investors start to prepare long before a bear market is officially declared. Indeed, the bull market can easily resume pushing stocks to all-time highs once again. In fact, I firmly believe we have until at least September until the bear market starts in earnest. However, starting to move your capital… Read More