08 November 2018
Singapore Straits Times Index (STI) market cycles provided 4 major opportunities in the past 31 years from 1987 to 2018
Singapore Straits Times Index (STI) market cycles provided 4 major opportunities in the past 31 years from 1987 to 2018.
Assume you got USD1m, your money was trippled to USD3m in the first opportunity; USD9m in the 2nd; USD27m in the 3rd; USD81m in the 4th!
Assume you got another 4 opportunities in the coming 31 years, what will happen?
What will happen if you use a margin of 300% in each opportunity?
So my friend, do not worry too much. Even if you got USD100k only now, you could have USD8.1m after 31 years!
Long Term Investment Strategy:
Buy the bluest stocks at 100% of planned amount after STI drops by 50% from high; buy another 50% with margin after STI drops by 60%; buy another 25% with margin after STI drops by 70%.
All of following conditions must be met before long term buying.
MSCI World Market Index dropped by more than 50%; (To make sure the drop is significant and sufficient world wide)
S&P 500 dropped by more than 50%; (To make sure US drop is significant and sufficient thus does not affect other countries especially the country you are in)
STI Index dropped by more than 50%; (To make sure the drop is significant and sufficient country wide thus does not affect the sector you are in)
Sector Index of the stock dropped by more than 50%; (To make sure the drop is significant and sufficient sector wide thus does not affect the stocks you are in)
Stock dropped by more than 50%; (To make sure the drop is significant and sufficient)
Check past 30 to 50 years of chart history of the candidate stocks (usually coming from the national stock index component companies) and select those stocks that rose the most in percentage (much much more than the index growth) in every bull market from the bear market bottom; (To makke sure you are able to outperform the index)
Target price: rising by at least 200% from the bear market bottom. (This is the minimum target, do not consider profit taking before this price)
Assume you got USD1m, your money was trippled to USD3m in the first opportunity; USD9m in the 2nd; USD27m in the 3rd; USD81m in the 4th!
Assume you got another 4 opportunities in the coming 31 years, what will happen?
What will happen if you use a margin of 300% in each opportunity?
So my friend, do not worry too much. Even if you got USD100k only now, you could have USD8.1m after 31 years!
Long Term Investment Strategy:
Buy the bluest stocks at 100% of planned amount after STI drops by 50% from high; buy another 50% with margin after STI drops by 60%; buy another 25% with margin after STI drops by 70%.
All of following conditions must be met before long term buying.
MSCI World Market Index dropped by more than 50%; (To make sure the drop is significant and sufficient world wide)
S&P 500 dropped by more than 50%; (To make sure US drop is significant and sufficient thus does not affect other countries especially the country you are in)
STI Index dropped by more than 50%; (To make sure the drop is significant and sufficient country wide thus does not affect the sector you are in)
Sector Index of the stock dropped by more than 50%; (To make sure the drop is significant and sufficient sector wide thus does not affect the stocks you are in)
Stock dropped by more than 50%; (To make sure the drop is significant and sufficient)
Check past 30 to 50 years of chart history of the candidate stocks (usually coming from the national stock index component companies) and select those stocks that rose the most in percentage (much much more than the index growth) in every bull market from the bear market bottom; (To makke sure you are able to outperform the index)
Target price: rising by at least 200% from the bear market bottom. (This is the minimum target, do not consider profit taking before this price)
Labels: Back Test, Charts, Historical Teachings, History, Margin, plan, STI ETF, Stock Trading System, Thoughts, Value Investing, Warren Buffett
14 January 2017
Warren Buffet uses these five investment criteria
It is well known that Warren Buffet uses these five investment criteria:
Free cash flow net income after taxes, plus depreciation and amortization, less capital expenditures) of at least $250 million.
Net profit margin of 15% or more.
Return on equity > of at least 15% for each of the past three years and the most recent quarter.
A dollar's worth of retained earnings creating at least a dollar's worth of shareholder value over the past five years.
Ample liquidity. Only stocks with a market capitalization of at least $500 million are included.
Free cash flow net income after taxes, plus depreciation and amortization, less capital expenditures) of at least $250 million.
Net profit margin of 15% or more.
Return on equity > of at least 15% for each of the past three years and the most recent quarter.
A dollar's worth of retained earnings creating at least a dollar's worth of shareholder value over the past five years.
Ample liquidity. Only stocks with a market capitalization of at least $500 million are included.
Labels: Stock Trading System, Warren Buffett
18 August 2015
巴菲特投资的奥秘之一，就是找那些容易做的事情，他表示，“我并不试图超过七英尺高的栏杆，我到处寻找的，是我能跨过的一英尺高的栏杆。”
巴菲特的投资要领很简单，选对公司，然后坚定长期持有，看似简单，但不是谁都能学会，等待市场出现大的纰漏才行动、从而轻松获得巨大回报的投资方法，关键点就在于等待时机，一举买入并坚定持有。
巴菲特的投资要领很简单，选对公司，然后坚定长期持有，看似简单，但不是谁都能学会，等待市场出现大的纰漏才行动、从而轻松获得巨大回报的投资方法，关键点就在于等待时机，一举买入并坚定持有。
Labels: Warren Buffett
06 July 2014
巴菲特遗嘱对退休投资的启示
巴菲特透露，他已成立了信托，来打理未来留给太太的遗产。巴菲特在遗嘱中特别指示了遗产的投资方法，他说：“我给信托人的投资指示再简单不过：拿出10%的资产买短期政府债券；剩余的90%全部投资到低手续费的标普500指数基金。“
巴菲特的遗嘱简直是难以置信- 谁能想到纵横股市几十年，号称史上最伟大的投资大师，在管理身后留给老婆遗产时，竟然只选择了两项简单到有点过分的投资方式！
惊奇之余，我们这些为退休而投资的散户，可以从中得到什么启示呢？
首先，巴菲特相信被动指数基金回报要高于积极选股型基金。虽然巴菲特号称股神，而且他毕生的成功就是建立在替管理的基金挑选股票。但连他都认为，普通投资者支付高额手续费给基金经理挑选最佳股票的做法得不偿失。长期历史统计说明，只有25%的基金经理，其挑选股票的业绩能打败股市的平均回报。6年前，巴菲特曾经和一些著名基金经理们打赌100万美元，赌他们所管理基金10年后的平均回报超不过标普500。现在这个赌局只剩下4年了，截至目前的业绩，还没有人可以赢走这100万。
其次，巴菲特认为股票回报超过债券等其他投资方式。巴菲特拿出高达90%的遗产投资在属于高风险投资的股票上，远远超出了一般投资组合中高风险投资所占的比例。我想，除了因为股票投资回报高以外，还一定是因为巴菲特相信10%的政府债券，已经足以保障老婆不会在股市大跌时因生活所迫被迫卖掉股票变现，从而避免股市波动造成重大损失。这一点，我们这类投资总金额相对较小一般退休投资者要慎重。决定股票的权重，关键在于，我们必须保证足够的现金应付股市的波动，不会为生活所迫在大市低点时被迫变现。
最后，巴菲特认为美股的表现会比其他市场好。在遗嘱中，股票100%投资于标普500，而没有像一般投资组合一样针对全球市场，均衡考虑发达国家和新兴国家。巴菲特本人的观点是，从美国建国以来，两百多年的历史中还没有和任何一个国家竞争失败，而股市是美国的经济基础，也不会败给其他国家的股市。这种想法是否正确，当然是仁者见仁，智者见智。不过，至少从近期看，投资于美国及欧洲等发达国家，回报很可能会高于投资于新兴国家股市。
说实话，我个人对巴菲特只用两个投资来打造投资组合有一点点的不以为然。而且，每个人情况不同，天底下也没有放之四海皆准的统一投资组合管理方式。尽管如此，我们在管理退休投资时，还是可以从他的遗嘱中学到一些重要原则的。至少，对我来说，我就决定以后要尽可能多采用低手续费被动指数基金，而不再热衷于选股。另外，我也决定在即使大市狂跌也不会影响基本生活来源的前提下，增加发达国家股票的权重，然后长期持有。
巴菲特的遗嘱简直是难以置信- 谁能想到纵横股市几十年，号称史上最伟大的投资大师，在管理身后留给老婆遗产时，竟然只选择了两项简单到有点过分的投资方式！
惊奇之余，我们这些为退休而投资的散户，可以从中得到什么启示呢？
首先，巴菲特相信被动指数基金回报要高于积极选股型基金。虽然巴菲特号称股神，而且他毕生的成功就是建立在替管理的基金挑选股票。但连他都认为，普通投资者支付高额手续费给基金经理挑选最佳股票的做法得不偿失。长期历史统计说明，只有25%的基金经理，其挑选股票的业绩能打败股市的平均回报。6年前，巴菲特曾经和一些著名基金经理们打赌100万美元，赌他们所管理基金10年后的平均回报超不过标普500。现在这个赌局只剩下4年了，截至目前的业绩，还没有人可以赢走这100万。
其次，巴菲特认为股票回报超过债券等其他投资方式。巴菲特拿出高达90%的遗产投资在属于高风险投资的股票上，远远超出了一般投资组合中高风险投资所占的比例。我想，除了因为股票投资回报高以外，还一定是因为巴菲特相信10%的政府债券，已经足以保障老婆不会在股市大跌时因生活所迫被迫卖掉股票变现，从而避免股市波动造成重大损失。这一点，我们这类投资总金额相对较小一般退休投资者要慎重。决定股票的权重，关键在于，我们必须保证足够的现金应付股市的波动，不会为生活所迫在大市低点时被迫变现。
最后，巴菲特认为美股的表现会比其他市场好。在遗嘱中，股票100%投资于标普500，而没有像一般投资组合一样针对全球市场，均衡考虑发达国家和新兴国家。巴菲特本人的观点是，从美国建国以来，两百多年的历史中还没有和任何一个国家竞争失败，而股市是美国的经济基础，也不会败给其他国家的股市。这种想法是否正确，当然是仁者见仁，智者见智。不过，至少从近期看，投资于美国及欧洲等发达国家，回报很可能会高于投资于新兴国家股市。
说实话，我个人对巴菲特只用两个投资来打造投资组合有一点点的不以为然。而且，每个人情况不同，天底下也没有放之四海皆准的统一投资组合管理方式。尽管如此，我们在管理退休投资时，还是可以从他的遗嘱中学到一些重要原则的。至少，对我来说，我就决定以后要尽可能多采用低手续费被动指数基金，而不再热衷于选股。另外，我也决定在即使大市狂跌也不会影响基本生活来源的前提下，增加发达国家股票的权重，然后长期持有。
Labels: ETF, Warren Buffett
03 April 2014
芒格语录
1.大部分人都太浮躁、担心得太多。成功需要非常平静耐心，但是机会来临的时候也要足够进取。
2. 如果你买了一个伟大的公司，你就坐那儿待着就行了。
3.无论何时，如果你觉得有东西在摧毁你的生活，那个东西就是你自己。老觉得自己是受害者的想法是最削弱自己的利器。
4.人们破产的常见原因是不能控制心理上的纠结。你花了这么多心血、这么多金钱，花的越多，就越容易这么想：“估计快成了，再多花一点儿，就能成了……” 人们就是这么破产的----因为他们不肯停下来想想：“之前投入的就算没了呗，我承受得起，我还可以重新振作。我不需要为这件事情沉迷不误，这可能会毁了我的。”
5.你要强迫自己去考虑对立的观点。如果你不能比你的对手更好地说服对方，那说明你的理解还不够。
6.大部分生活和事业上的成功来自于有意避免了一些东西：早死、错误的婚姻、等等。
7.经常对照一下清单可以避免错误。你们应该掌握这些基础的智慧。对照清单之前还要过一遍心理清单（意指平常心），这个方法是无可替代的。
8.我们都爱大量阅读，聪明人都这样，但这还不够，你还应该有一种批判接受、合理应用的态度。大部分人看书都没有抓到正确的重点，看完了又不会学以致用。
9.做空行为是很危险的。
10.在空头位置，又看到股价遇到利好大涨，这是一件特别让人气愤的事情。人生苦短，遭受这种气愤太不值当了。
11.巴菲特和我不是因为成功预测了宏观经济并且依此下注才获得今天的成功的。
12.游戏的重点不是非常多的动作而是非常大的耐心。要坚守你的原则，当机会出现的时候，就大力出击。
13.如果想提高你的认知能力，忘记过去犯过的错误是坚决不行的。
14.承认自己不懂某样东西意味着智慧的曙光即将来临。
15.我们努力做到通过牢记常识而不是通过知晓尖端知识赚钱。
16.你只有学会了如何学习才能进步。
2. 如果你买了一个伟大的公司，你就坐那儿待着就行了。
3.无论何时，如果你觉得有东西在摧毁你的生活，那个东西就是你自己。老觉得自己是受害者的想法是最削弱自己的利器。
4.人们破产的常见原因是不能控制心理上的纠结。你花了这么多心血、这么多金钱，花的越多，就越容易这么想：“估计快成了，再多花一点儿，就能成了……” 人们就是这么破产的----因为他们不肯停下来想想：“之前投入的就算没了呗，我承受得起，我还可以重新振作。我不需要为这件事情沉迷不误，这可能会毁了我的。”
5.你要强迫自己去考虑对立的观点。如果你不能比你的对手更好地说服对方，那说明你的理解还不够。
6.大部分生活和事业上的成功来自于有意避免了一些东西：早死、错误的婚姻、等等。
7.经常对照一下清单可以避免错误。你们应该掌握这些基础的智慧。对照清单之前还要过一遍心理清单（意指平常心），这个方法是无可替代的。
8.我们都爱大量阅读，聪明人都这样，但这还不够，你还应该有一种批判接受、合理应用的态度。大部分人看书都没有抓到正确的重点，看完了又不会学以致用。
9.做空行为是很危险的。
10.在空头位置，又看到股价遇到利好大涨，这是一件特别让人气愤的事情。人生苦短，遭受这种气愤太不值当了。
11.巴菲特和我不是因为成功预测了宏观经济并且依此下注才获得今天的成功的。
12.游戏的重点不是非常多的动作而是非常大的耐心。要坚守你的原则，当机会出现的时候，就大力出击。
13.如果想提高你的认知能力，忘记过去犯过的错误是坚决不行的。
14.承认自己不懂某样东西意味着智慧的曙光即将来临。
15.我们努力做到通过牢记常识而不是通过知晓尖端知识赚钱。
16.你只有学会了如何学习才能进步。
Labels: Investment Quote, Warren Buffett
07 November 2013
不听巴菲特之言 错失股市翻倍的机会
就在五年前，全球金融机构似乎处于崩溃边缘，股市一落千丈，巴菲特(Warren Buffett)在《纽约时报》撰写了一篇当时似乎与市场脉动脱节的评论文章。他鼓励投资者买进。
买进？当时78岁的巴菲特似乎终于老煳涂了。
当然，现在看来那是个绝佳的建议。
遗憾的是，遵循这条建议的人不够多。
巴菲特当时写道，金融世界一片混乱，美国和海外都是如此。此外，金融行业的问题已经渗透到整体经济中，而且现在正由渗漏演变成井喷。近期内，失业率将会升高，商业活动将会衰退，媒体头条会继续令人惊慌。
但他补充说，他在为自己的个人账户买进股票。
巴菲特写道，我买进只是根据一个简单的原则：在他人贪婪时恐惧，而在他人恐惧时贪婪。毫无疑问，如今恐惧情绪遍地都是，就连老练的投资者也未能幸免。
我们都知道在那之后发生的事情。道琼斯指数接近翻番。该指数上涨了88%，周二收于15,680点的纪录高位。标普500指数的表现更好，上涨97%，超过了1,770点。
巴菲特说中的不只是买进机会（他说得太对了）。他还说中了人们的恐惧。我们大多数人恐惧的时间都太长了。
美国投资公司学会(Investment Company Institute)的数据显示，投资者2008年全年平均向共同基金投入了4,040亿美元，2009年撤出了1,500亿美元。
投资公司学会数据显示，在巴菲特告诉投资者买进之后，投资者已经从全部股票型基金中撤出3,090亿美元，从美国本土股票基金中撤出4,480亿美元之多。
但令人担忧的是，这种恐惧一直持续。
资产管理公司贝莱德(BlackRock Inc.)本周发布的一项调查显示，大多数美国人在投资方面仍然担惊受怕。他们将48%的可投资资产留作现金，只有18%投入股票，7%投入债券。
现在，投资者觉得他们错过了好时机。36%的受访者说，他们觉得自己要是早些为退休投资就好了。
今年持续整年的涨势表明，投资者已经回归，但在这之前，他们已经错过了大部分的涨势。
今年迄今，投资者向股票基金新投入了1,060亿美元，但还没有补足过去三年抛售的规模。投资公司学会的数据显示，从2010年8月至2013年8月，投资者从股票基金撤出了1,950亿美元--这还包括了最近的买入。
我们从中只能得出一个结论。尽管巴菲特有投资"先知"之名，但我们并不听从他的意见。
公平地说，确实有很多迹象足以让我们忽视他的说法。在他的建议公布之后不到六个月的时间里，标普500指数再跌24%。道琼斯指数下跌20%。
即使之后开始缓慢并且确定无疑的反弹，也还是有一系列的事件令投资股市显得极具风险。
先后发生的事情有：希腊和欧洲债务危机；法国、塞浦路斯和意大利的银行业危机；房价下跌；2012年5月的"闪电崩盘"；美国联邦政府预算停顿；华盛顿就债务上限问题出现多次对峙；最近的一次是美国政府关门影响了复苏。
然而，上述麻烦都没有真正地令整体市场长时间下挫。虽然市场交投清淡，但占主导的交易是买进。
对于那些接受了巴菲特建议的人来说，过去的五年是非常美妙的五年。
而对其他人来说，我们在应当贪婪的时候却恐惧了。
买进？当时78岁的巴菲特似乎终于老煳涂了。
当然，现在看来那是个绝佳的建议。
遗憾的是，遵循这条建议的人不够多。
巴菲特当时写道，金融世界一片混乱，美国和海外都是如此。此外，金融行业的问题已经渗透到整体经济中，而且现在正由渗漏演变成井喷。近期内，失业率将会升高，商业活动将会衰退，媒体头条会继续令人惊慌。
但他补充说，他在为自己的个人账户买进股票。
巴菲特写道，我买进只是根据一个简单的原则：在他人贪婪时恐惧，而在他人恐惧时贪婪。毫无疑问，如今恐惧情绪遍地都是，就连老练的投资者也未能幸免。
我们都知道在那之后发生的事情。道琼斯指数接近翻番。该指数上涨了88%，周二收于15,680点的纪录高位。标普500指数的表现更好，上涨97%，超过了1,770点。
巴菲特说中的不只是买进机会（他说得太对了）。他还说中了人们的恐惧。我们大多数人恐惧的时间都太长了。
美国投资公司学会(Investment Company Institute)的数据显示，投资者2008年全年平均向共同基金投入了4,040亿美元，2009年撤出了1,500亿美元。
投资公司学会数据显示，在巴菲特告诉投资者买进之后，投资者已经从全部股票型基金中撤出3,090亿美元，从美国本土股票基金中撤出4,480亿美元之多。
但令人担忧的是，这种恐惧一直持续。
资产管理公司贝莱德(BlackRock Inc.)本周发布的一项调查显示，大多数美国人在投资方面仍然担惊受怕。他们将48%的可投资资产留作现金，只有18%投入股票，7%投入债券。
现在，投资者觉得他们错过了好时机。36%的受访者说，他们觉得自己要是早些为退休投资就好了。
今年持续整年的涨势表明，投资者已经回归，但在这之前，他们已经错过了大部分的涨势。
今年迄今，投资者向股票基金新投入了1,060亿美元，但还没有补足过去三年抛售的规模。投资公司学会的数据显示，从2010年8月至2013年8月，投资者从股票基金撤出了1,950亿美元--这还包括了最近的买入。
我们从中只能得出一个结论。尽管巴菲特有投资"先知"之名，但我们并不听从他的意见。
公平地说，确实有很多迹象足以让我们忽视他的说法。在他的建议公布之后不到六个月的时间里，标普500指数再跌24%。道琼斯指数下跌20%。
即使之后开始缓慢并且确定无疑的反弹，也还是有一系列的事件令投资股市显得极具风险。
先后发生的事情有：希腊和欧洲债务危机；法国、塞浦路斯和意大利的银行业危机；房价下跌；2012年5月的"闪电崩盘"；美国联邦政府预算停顿；华盛顿就债务上限问题出现多次对峙；最近的一次是美国政府关门影响了复苏。
然而，上述麻烦都没有真正地令整体市场长时间下挫。虽然市场交投清淡，但占主导的交易是买进。
对于那些接受了巴菲特建议的人来说，过去的五年是非常美妙的五年。
而对其他人来说，我们在应当贪婪的时候却恐惧了。
Labels: Warren Buffett
07 October 2013
Buffett's Crisis-Lending Haul Reaches $10 Billion
Billionaire Warren Buffett tossed lifelines to a handful of blue-chip companies during the financial crisis. Five years later the payoff on those deals is becoming clear: $10 billion and counting.
Mr. Buffett approached that figure after he collected another hefty payment last week, bringing to nearly 40% the pretax income on his crisis-era investments, according to a Wall Street Journal analysis.
The bounty is a vivid illustration of one of Mr. Buffett's favorite investing maxims: "Be fearful when others are greedy, and be greedy when others are fearful."
The latest windfall for the Omaha, Neb., billionaire and his conglomerate, Berkshire Hathaway Inc., came when candy maker Mars Inc. repaid $4.4 billion that its subsidiary, Wrigley, borrowed in 2008. That payment alone is expected to net Berkshire a profit of at least $680 million.
"In terms of simple profitability, an average investor could have done just as well investing in the stock market if they bought during the panic period," Mr. Buffett said in an interview Saturday. He was referring to a monthslong stretch beginning in the fall of 2008 when the stocks of some of his favorite companies, including Wells Fargo & Co. and American Express Co., fell to historic lows. "You make your best buys when people are overwhelmingly fearful."
But few investors, if any, capitalized on the crisis as expertly.
By comparison, the U.S. government invested about $420 billion through its Troubled Asset Relief Program. The government also demanded beneficial terms and collected sizable dividend payments for a return of about $50 billion, or 12%, thus far, according to the U.S. Treasury's website.
Mr. Buffett said he hopes to use the cash to make other big investments soon that will bring equally attractive returns. Berkshire will continue to buy stocks to add to its portfolio of over $100 billion, because "it's still better to have equities than cash," he said.
But big acquisitions such as the 2010 purchase of railroad operator BNSF Railway Co. for $26 billion have gotten harder to find. As prices have risen along with the economic recovery, Mr. Buffett has publicly lamented the paucity of transformative deals that would allow Berkshire to put some of its cash to use.
Starting with Mars in April of 2008, when credit markets began to tighten in advance of the financial crisis, some big-name companies looked to Mr. Buffett—and Berkshire's huge war chest—as a lender of last resort.
In addition to much-needed capital, the companies acquired something equally valuable: Mr. Buffett's implicit endorsement of their long-term prospects. Shares of these companies generally went up after they revealed Berkshire's involvement.
In six major deals, Berkshire invested a total of about $26 billion. Mr. Buffett used Berkshire's gigantic cash hoard to move swiftly and exact lucrative terms that created a stream of payments from the borrowers.
Mr. Buffett's deal-making started in the early days of the crisis and continued deep into the recovery. The last of the deals was a 2011 loan to Bank of America Corp. for $5 billion.
Besides Mars and Bank of America, Berkshire made investments in Goldman Sachs Group Inc., Swiss Re Ltd., Dow Chemical Co., and General Electric Co.
Several deals are continuing to pay hefty dividends. Berkshire also owns equity stakes in the firms, or warrants to buy them, that add several billion dollars more to the company's return on investments, at least on paper.
Although the warrants on some of these deals effectively came free with Berkshire's purchase of preferred shares, accounting rules require the company to split its cost between the stock and warrants acquired. That means Berkshire records gains differently in its books than a cash-in, cash-out tally adding up to about $10 billion.
As the economy has recovered, and with credit available at more attractive rates, some of the companies have opted to redeem securities owned by Berkshire or adjust the terms in ways favorable to Mr. Buffett.
Dow Chemical, which borrowed $3 billion from Berkshire to help fund the 2009 acquisition of Rohm & Haas, has said buying back the preferred stock is a priority.
Also last week, Berkshire became one of Goldman's largest shareholders with a $2.1 billion stake after the close of a five-year deal in which Berkshire injected $5 billion into the bank.
Berkshire bought 50,000 shares of preferred stock from Goldman that required the bank to pay $500 million in annual dividends. When Goldman redeemed the shares in March 2011, it paid Berkshire an extra $500 million as a premium.
The original deal also gave Berkshire warrants to buy 43.5 million common shares for an additional $5 billion, which would have made the conglomerate Goldman's largest shareholder. In March, the bank amended the terms to give Berkshire a smaller stake without Berkshire having to spend extra dollars.
Berkshire helped Mars finance its $23 billion purchase of Wrigley. The company has sought to refinance parts of its debt since then to take advantage of lower interest rates and an improved credit rating, a spokesman said.
Berkshire contributed $6.5 billion, including $2.1 billion for preferred stock in Wrigley that pays an annual dividend. Berkshire also bought an additional $1 billion of Wrigley debt later. Thus far, the investment is expected to net Berkshire nearly $4 billion, including annual dividends and a prepayment premium since the bonds were due in 2018.
Mr. Buffett's stake in Bank of America could pay off for years. Berkshire invested $5 billion in the bank in 2011, which adds about $300 million in annual pretax income. Bank of America Chief Executive Brian Moynihan recently said he doesn't plan to buy back the preferred shares any time soon. Berkshire also has until 2021 to exercise warrants for 700 million common shares for an additional $5 billion at $7.14 a share. Based on the bank's current stock price of about $14, the warrants create a paper profit of nearly $5 billion.
Write to Anupreeta Das at anupreeta.das@wsj.com
Mr. Buffett approached that figure after he collected another hefty payment last week, bringing to nearly 40% the pretax income on his crisis-era investments, according to a Wall Street Journal analysis.
The bounty is a vivid illustration of one of Mr. Buffett's favorite investing maxims: "Be fearful when others are greedy, and be greedy when others are fearful."
The latest windfall for the Omaha, Neb., billionaire and his conglomerate, Berkshire Hathaway Inc., came when candy maker Mars Inc. repaid $4.4 billion that its subsidiary, Wrigley, borrowed in 2008. That payment alone is expected to net Berkshire a profit of at least $680 million.
"In terms of simple profitability, an average investor could have done just as well investing in the stock market if they bought during the panic period," Mr. Buffett said in an interview Saturday. He was referring to a monthslong stretch beginning in the fall of 2008 when the stocks of some of his favorite companies, including Wells Fargo & Co. and American Express Co., fell to historic lows. "You make your best buys when people are overwhelmingly fearful."
But few investors, if any, capitalized on the crisis as expertly.
By comparison, the U.S. government invested about $420 billion through its Troubled Asset Relief Program. The government also demanded beneficial terms and collected sizable dividend payments for a return of about $50 billion, or 12%, thus far, according to the U.S. Treasury's website.
Mr. Buffett said he hopes to use the cash to make other big investments soon that will bring equally attractive returns. Berkshire will continue to buy stocks to add to its portfolio of over $100 billion, because "it's still better to have equities than cash," he said.
But big acquisitions such as the 2010 purchase of railroad operator BNSF Railway Co. for $26 billion have gotten harder to find. As prices have risen along with the economic recovery, Mr. Buffett has publicly lamented the paucity of transformative deals that would allow Berkshire to put some of its cash to use.
Starting with Mars in April of 2008, when credit markets began to tighten in advance of the financial crisis, some big-name companies looked to Mr. Buffett—and Berkshire's huge war chest—as a lender of last resort.
In addition to much-needed capital, the companies acquired something equally valuable: Mr. Buffett's implicit endorsement of their long-term prospects. Shares of these companies generally went up after they revealed Berkshire's involvement.
In six major deals, Berkshire invested a total of about $26 billion. Mr. Buffett used Berkshire's gigantic cash hoard to move swiftly and exact lucrative terms that created a stream of payments from the borrowers.
Mr. Buffett's deal-making started in the early days of the crisis and continued deep into the recovery. The last of the deals was a 2011 loan to Bank of America Corp. for $5 billion.
Besides Mars and Bank of America, Berkshire made investments in Goldman Sachs Group Inc., Swiss Re Ltd., Dow Chemical Co., and General Electric Co.
Several deals are continuing to pay hefty dividends. Berkshire also owns equity stakes in the firms, or warrants to buy them, that add several billion dollars more to the company's return on investments, at least on paper.
Although the warrants on some of these deals effectively came free with Berkshire's purchase of preferred shares, accounting rules require the company to split its cost between the stock and warrants acquired. That means Berkshire records gains differently in its books than a cash-in, cash-out tally adding up to about $10 billion.
As the economy has recovered, and with credit available at more attractive rates, some of the companies have opted to redeem securities owned by Berkshire or adjust the terms in ways favorable to Mr. Buffett.
Dow Chemical, which borrowed $3 billion from Berkshire to help fund the 2009 acquisition of Rohm & Haas, has said buying back the preferred stock is a priority.
Also last week, Berkshire became one of Goldman's largest shareholders with a $2.1 billion stake after the close of a five-year deal in which Berkshire injected $5 billion into the bank.
Berkshire bought 50,000 shares of preferred stock from Goldman that required the bank to pay $500 million in annual dividends. When Goldman redeemed the shares in March 2011, it paid Berkshire an extra $500 million as a premium.
The original deal also gave Berkshire warrants to buy 43.5 million common shares for an additional $5 billion, which would have made the conglomerate Goldman's largest shareholder. In March, the bank amended the terms to give Berkshire a smaller stake without Berkshire having to spend extra dollars.
Berkshire helped Mars finance its $23 billion purchase of Wrigley. The company has sought to refinance parts of its debt since then to take advantage of lower interest rates and an improved credit rating, a spokesman said.
Berkshire contributed $6.5 billion, including $2.1 billion for preferred stock in Wrigley that pays an annual dividend. Berkshire also bought an additional $1 billion of Wrigley debt later. Thus far, the investment is expected to net Berkshire nearly $4 billion, including annual dividends and a prepayment premium since the bonds were due in 2018.
Mr. Buffett's stake in Bank of America could pay off for years. Berkshire invested $5 billion in the bank in 2011, which adds about $300 million in annual pretax income. Bank of America Chief Executive Brian Moynihan recently said he doesn't plan to buy back the preferred shares any time soon. Berkshire also has until 2021 to exercise warrants for 700 million common shares for an additional $5 billion at $7.14 a share. Based on the bank's current stock price of about $14, the warrants create a paper profit of nearly $5 billion.
Write to Anupreeta Das at anupreeta.das@wsj.com
Labels: Reference, Warren Buffett
20 September 2013
Buffett's best quotes
"It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price."
Source: Letter to shareholders, 1989
You don't have to be a genius to invest well.
ebravolosada / Flickr
"You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with 130 IQ."
Source: Warren Buffet Speaks, via msnbc.msn
But, master the basics.
North Carolina Digital Heritage
"To invest successfully, you need not understand beta, efficient markets, modern portfolio theory, option pricing or emerging markets. You may, in fact, be better off knowing nothing of these. That, of course, is not the prevailing view at most business schools, whose finance curriculum tends to be dominated by such subjects. In our view, though, investment students need only two well-taught courses - How to Value a Business, and How to Think About Market Prices."
Source: Chairman's Letter, 1996
Don't buy a stock just because everyone hates it.
trix0r via Flickr
"None of this means, however, that a business or stock is an intelligent purchase simply because it is unpopular; a contrarian approach is just as foolish as a follow-the-crowd strategy. What's required is thinking rather than polling. Unfortunately, Bertrand Russell's observation about life in general applies with unusual force in the financial world: "Most men would rather die than think. Many do."
Source: Chairman's Letter, 1990
Bad things aren't obvious when times are good.
tavopp / Flickr
"After all, you only find out who is swimming naked when the tide goes out."
Source: Letter to shareholders, 2001
Always be liquid.
Flickr / noahwesley
"I have pledged – to you, the rating agencies and myself – to always run Berkshire with more than ample cash. We never want to count on the kindness of strangers in order to meet tomorrow’s obligations. When forced to choose, I will not trade even a night’s sleep for the chance of extra profits."
Source: Letter to shareholders, 2008
The best time to buy a company is when it's in trouble.
Nightly Business News via YouTube
"The best thing that happens to us is when a great company gets into temporary trouble...We want to buy them when they're on the operating table."
Source: Businessweek, 1999
Stocks have always come out of crises.
Wikimedia Commons
A soup kitchen in 1936
"Over the long term, the stock market news will be good. In the 20th century, the United States endured two world wars and other traumatic and expensive military conflicts; the Depression; a dozen or so recessions and financial panics; oil shocks; a flu epidemic; and the resignation of a disgraced president. Yet the Dow rose from 66 to 11,497."
Source: The New York Times, October 16, 2008
Don't be fooled by that Cinderella feeling you get from great returns
Kent Freeman / Flickr
"The line separating investment and speculation, which is never bright and clear, becomes blurred still further when most market participants have recently enjoyed triumphs. Nothing sedates rationality like large doses of effortless money. After a heady experience of that kind, normally sensible people drift into behavior akin to that of Cinderella at the ball. They know that overstaying the festivities ¾ that is, continuing to speculate in companies that have gigantic valuations relative to the cash they are likely to generate in the future ¾ will eventually bring on pumpkins and mice. But they nevertheless hate to miss a single minute of what is one helluva party. Therefore, the giddy participants all plan to leave just seconds before midnight. There’s a problem, though: They are dancing in a room in which the clocks have no hands."
Source: Letter to shareholders, 2000
Think long-term.
JuditK / Flickr
"Your goal as an investor should simply be to purchase, at a rational price, a part interest in an easily-understandable business whose earnings are virtually certain to be materially higher five, ten and twenty years from now. Over time, you will find only a few companies that meet these standards - so when you see one that qualifies, you should buy a meaningful amount of stock. You must also resist the temptation to stray from your guidelines: If you aren't willing to own a stock for ten years, don't even think about owning it for ten minutes. Put together a portfolio of companies whose aggregate earnings march upward over the years, and so also will the portfolio's market value."
Source: Chairman's Letter, 1996
Forever is a good holding period.
m.a.r.c. / flickr
"When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever."
Source: Letter to shareholders, 1988
Buy businesses that can be run by idiots.
"I try to buy stock in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will."
Source: Business Insider
Be greedy when others are fearful.
Flickr / martj
"Investors should remember that excitement and expenses are their enemies. And if they insist on trying to time their participation in equities, they should try to be fearful when others are greedy and greedy only when others are fearful."
Source: Letter to shareholders, 2004
You don't have to move at every opportunity.
adwriter / Flickr
"The stock market is a no-called-strike game. You don't have to swing at everything--you can wait for your pitch. The problem when you're a money manager is that your fans keep yelling, 'Swing, you bum!'"
Source: The Tao of Warren Buffett via Engineeringnews.com
Ignore politics and macroeconomics when picking stocks.
wikimedia
"We will continue to ignore political and economic forecasts, which are an expensive distraction for many investors and businessmen. Thirty years ago, no one could have foreseen the huge expansion of the Vietnam War, wage and price controls, two oil shocks, the resignation of a president, the dissolution of the Soviet Union, a one-day drop in the Dow of 508 points, or treasury bill yields fluctuating between 2.8% and 17.4%.
"But, surprise - none of these blockbuster events made the slightest dent in Ben Graham's investment principles. Nor did they render unsound the negotiated purchases of fine businesses at sensible prices. Imagine the cost to us, then, if we had let a fear of unknowns cause us to defer or alter the deployment of capital. Indeed, we have usually made our best purchases when apprehensions about some macro event were at a peak. Fear is the foe of the faddist, but the friend of the fundamentalist.
Source: Chairman's Letter, 1994
The more you trade, the more you underperform.
Public domain
"Long ago, Sir Isaac Newton gave us three laws of motion, which were the work of genius. But Sir Isaac’s talents didn’t extend to investing: He lost a bundle in the South Sea Bubble, explaining later, “I can calculate the movement of the stars, but not the madness of men.” If he had not been traumatized by this loss, Sir Isaac might well have gone on to discover the Fourth Law of Motion: For investors as a whole, returns decrease as motion increases."
Source: Letters to shareholders, 2005
Price and value are not the same
Net Efekt / Flickr, CC
"Long ago, Ben Graham taught me that 'Price is what you pay; value is what you get.' Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down."
Source: Letter to shareholders, 2008
There are no bonus points for complicated investments.
stuartpilbrow via flickr
"Our investments continue to be few in number and simple in concept: The truly big investment idea can usually be explained in a short paragraph. We like a business with enduring competitive advantages that is run by able and owner-oriented people. When these attributes exist, and when we can make purchases at sensible prices, it is hard to go wrong (a challenge we periodically manage to overcome).
"Investors should remember that their scorecard is not computed using Olympic-diving methods: Degree-of-difficulty doesn’t count. If you are right about a business whole value is largely dependent on a single key factor that is both easy to understand and enduring, the payoff is the same as if you had correctly analyzed an investment alternative characterized by many constantly shifting and complex variables."
Source: Chairman's Letter, 1994
A good businessperson makes a good investor.
PYMNTS.com via Vimeo
"I am a better investor because I am a businessman, and a better businessman because I am an investor."
Source: Forbes.com - Thoughts On The Business Life
Higher taxes aren't a dealbreaker.
MoneyBlogNewz / Flickr
"SUPPOSE that an investor you admire and trust comes to you with an investment idea. “This is a good one,” he says enthusiastically. “I’m in it, and I think you should be, too.”
Would your reply possibly be this? “Well, it all depends on what my tax rate will be on the gain you’re saying we’re going to make. If the taxes are too high, I would rather leave the money in my savings account, earning a quarter of 1 percent.” Only in Grover Norquist’s imagination does such a response exist."
Source: New York Times
Companies that don't change can be great investments.
By Jono Haysom on Flickr
"Our approach is very much profiting from lack of change rather than from change. With Wrigley chewing gum, it's the lack of change that appeals to me. I don't think it is going to be hurt by the Internet. That's the kind of business I like."
Source: Businessweek, 1999
This is the most important thing.
Wikipeda
"Rule No. 1: never lose money; rule No. 2: don't forget rule No. 1"
Source: The Tao of Warren Buffett
Time will tell.
pepe50 / Flickr
"Time is the friend of the wonderful business, the enemy of the mediocre."
Source: Letters to shareholders 1989
BONUS: On Wall Street advice
Flickr/jiazi
"Wall Street is the only place that people ride to in a Rolls-Royce to get advice from those who take the subway."
Source: The Tao of Warren Buffett
Source: Letter to shareholders, 1989
You don't have to be a genius to invest well.
ebravolosada / Flickr
"You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with 130 IQ."
Source: Warren Buffet Speaks, via msnbc.msn
But, master the basics.
North Carolina Digital Heritage
"To invest successfully, you need not understand beta, efficient markets, modern portfolio theory, option pricing or emerging markets. You may, in fact, be better off knowing nothing of these. That, of course, is not the prevailing view at most business schools, whose finance curriculum tends to be dominated by such subjects. In our view, though, investment students need only two well-taught courses - How to Value a Business, and How to Think About Market Prices."
Source: Chairman's Letter, 1996
Don't buy a stock just because everyone hates it.
trix0r via Flickr
"None of this means, however, that a business or stock is an intelligent purchase simply because it is unpopular; a contrarian approach is just as foolish as a follow-the-crowd strategy. What's required is thinking rather than polling. Unfortunately, Bertrand Russell's observation about life in general applies with unusual force in the financial world: "Most men would rather die than think. Many do."
Source: Chairman's Letter, 1990
Bad things aren't obvious when times are good.
tavopp / Flickr
"After all, you only find out who is swimming naked when the tide goes out."
Source: Letter to shareholders, 2001
Always be liquid.
Flickr / noahwesley
"I have pledged – to you, the rating agencies and myself – to always run Berkshire with more than ample cash. We never want to count on the kindness of strangers in order to meet tomorrow’s obligations. When forced to choose, I will not trade even a night’s sleep for the chance of extra profits."
Source: Letter to shareholders, 2008
The best time to buy a company is when it's in trouble.
Nightly Business News via YouTube
"The best thing that happens to us is when a great company gets into temporary trouble...We want to buy them when they're on the operating table."
Source: Businessweek, 1999
Stocks have always come out of crises.
Wikimedia Commons
A soup kitchen in 1936
"Over the long term, the stock market news will be good. In the 20th century, the United States endured two world wars and other traumatic and expensive military conflicts; the Depression; a dozen or so recessions and financial panics; oil shocks; a flu epidemic; and the resignation of a disgraced president. Yet the Dow rose from 66 to 11,497."
Source: The New York Times, October 16, 2008
Don't be fooled by that Cinderella feeling you get from great returns
Kent Freeman / Flickr
"The line separating investment and speculation, which is never bright and clear, becomes blurred still further when most market participants have recently enjoyed triumphs. Nothing sedates rationality like large doses of effortless money. After a heady experience of that kind, normally sensible people drift into behavior akin to that of Cinderella at the ball. They know that overstaying the festivities ¾ that is, continuing to speculate in companies that have gigantic valuations relative to the cash they are likely to generate in the future ¾ will eventually bring on pumpkins and mice. But they nevertheless hate to miss a single minute of what is one helluva party. Therefore, the giddy participants all plan to leave just seconds before midnight. There’s a problem, though: They are dancing in a room in which the clocks have no hands."
Source: Letter to shareholders, 2000
Think long-term.
JuditK / Flickr
"Your goal as an investor should simply be to purchase, at a rational price, a part interest in an easily-understandable business whose earnings are virtually certain to be materially higher five, ten and twenty years from now. Over time, you will find only a few companies that meet these standards - so when you see one that qualifies, you should buy a meaningful amount of stock. You must also resist the temptation to stray from your guidelines: If you aren't willing to own a stock for ten years, don't even think about owning it for ten minutes. Put together a portfolio of companies whose aggregate earnings march upward over the years, and so also will the portfolio's market value."
Source: Chairman's Letter, 1996
Forever is a good holding period.
m.a.r.c. / flickr
"When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever."
Source: Letter to shareholders, 1988
Buy businesses that can be run by idiots.
"I try to buy stock in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will."
Source: Business Insider
Be greedy when others are fearful.
Flickr / martj
"Investors should remember that excitement and expenses are their enemies. And if they insist on trying to time their participation in equities, they should try to be fearful when others are greedy and greedy only when others are fearful."
Source: Letter to shareholders, 2004
You don't have to move at every opportunity.
adwriter / Flickr
"The stock market is a no-called-strike game. You don't have to swing at everything--you can wait for your pitch. The problem when you're a money manager is that your fans keep yelling, 'Swing, you bum!'"
Source: The Tao of Warren Buffett via Engineeringnews.com
Ignore politics and macroeconomics when picking stocks.
wikimedia
"We will continue to ignore political and economic forecasts, which are an expensive distraction for many investors and businessmen. Thirty years ago, no one could have foreseen the huge expansion of the Vietnam War, wage and price controls, two oil shocks, the resignation of a president, the dissolution of the Soviet Union, a one-day drop in the Dow of 508 points, or treasury bill yields fluctuating between 2.8% and 17.4%.
"But, surprise - none of these blockbuster events made the slightest dent in Ben Graham's investment principles. Nor did they render unsound the negotiated purchases of fine businesses at sensible prices. Imagine the cost to us, then, if we had let a fear of unknowns cause us to defer or alter the deployment of capital. Indeed, we have usually made our best purchases when apprehensions about some macro event were at a peak. Fear is the foe of the faddist, but the friend of the fundamentalist.
Source: Chairman's Letter, 1994
The more you trade, the more you underperform.
Public domain
"Long ago, Sir Isaac Newton gave us three laws of motion, which were the work of genius. But Sir Isaac’s talents didn’t extend to investing: He lost a bundle in the South Sea Bubble, explaining later, “I can calculate the movement of the stars, but not the madness of men.” If he had not been traumatized by this loss, Sir Isaac might well have gone on to discover the Fourth Law of Motion: For investors as a whole, returns decrease as motion increases."
Source: Letters to shareholders, 2005
Price and value are not the same
Net Efekt / Flickr, CC
"Long ago, Ben Graham taught me that 'Price is what you pay; value is what you get.' Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down."
Source: Letter to shareholders, 2008
There are no bonus points for complicated investments.
stuartpilbrow via flickr
"Our investments continue to be few in number and simple in concept: The truly big investment idea can usually be explained in a short paragraph. We like a business with enduring competitive advantages that is run by able and owner-oriented people. When these attributes exist, and when we can make purchases at sensible prices, it is hard to go wrong (a challenge we periodically manage to overcome).
"Investors should remember that their scorecard is not computed using Olympic-diving methods: Degree-of-difficulty doesn’t count. If you are right about a business whole value is largely dependent on a single key factor that is both easy to understand and enduring, the payoff is the same as if you had correctly analyzed an investment alternative characterized by many constantly shifting and complex variables."
Source: Chairman's Letter, 1994
A good businessperson makes a good investor.
PYMNTS.com via Vimeo
"I am a better investor because I am a businessman, and a better businessman because I am an investor."
Source: Forbes.com - Thoughts On The Business Life
Higher taxes aren't a dealbreaker.
MoneyBlogNewz / Flickr
"SUPPOSE that an investor you admire and trust comes to you with an investment idea. “This is a good one,” he says enthusiastically. “I’m in it, and I think you should be, too.”
Would your reply possibly be this? “Well, it all depends on what my tax rate will be on the gain you’re saying we’re going to make. If the taxes are too high, I would rather leave the money in my savings account, earning a quarter of 1 percent.” Only in Grover Norquist’s imagination does such a response exist."
Source: New York Times
Companies that don't change can be great investments.
By Jono Haysom on Flickr
"Our approach is very much profiting from lack of change rather than from change. With Wrigley chewing gum, it's the lack of change that appeals to me. I don't think it is going to be hurt by the Internet. That's the kind of business I like."
Source: Businessweek, 1999
This is the most important thing.
Wikipeda
"Rule No. 1: never lose money; rule No. 2: don't forget rule No. 1"
Source: The Tao of Warren Buffett
Time will tell.
pepe50 / Flickr
"Time is the friend of the wonderful business, the enemy of the mediocre."
Source: Letters to shareholders 1989
BONUS: On Wall Street advice
Flickr/jiazi
"Wall Street is the only place that people ride to in a Rolls-Royce to get advice from those who take the subway."
Source: The Tao of Warren Buffett
Labels: Investment Quote, Warren Buffett
17 September 2013
41 of the most insightful and useful concise quotes about investing
1. Price is what you pay. Value is what you get.
–Warren Buffett (This was actually told Warren Buffett by his teacher cum boss, Benjamin Graham - TopTrader)
2. Rule No.1: Never lose money. Rule No.2: Never forget rule No.1.
–Warren Buffett
3. If you’re prepared to invest in a company, you ought to be able to explain why in simple language that a fifth grader could understand, and quickly enough so the fifth grader won’t get bored.
–Peter Lynch
4. Behind every stock is a company. Find out what it’s doing.
–Peter Lynch
5. While it might seem that anyone can be a value investor, the essential characteristics of this type of investor-patience, discipline, and risk aversion-may well be genetically determined.
–Seth Klarmans
6. Twenty years in this business convinces me that any normal person using the customary three percent of the brain can pick stocks just as well, if not better, than the average Wall Street expert.
–Peter Lynch
7. The underlying principles of sound investment should not alter from decade to decade, but the application of these principles must be adapted to significant changes in the financial mechanisms and climate.
–Benjamin Graham
8. Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.
–Warren Buffett
9. We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful. -
Warren Buffett
10. The individual investor should act consistently as an investor and not as a speculator.
–Benjamin Graham
11. Know what you own, and know why you own it.
–Peter Lynch
12. Based on my own personal experience – both as an investor in recent years and an expert witness in years past – rarely do more than three or four variables really count. Everything else is noise.
–Martin Whitman
13. We ignore outlooks and forecasts… we’re lousy at it and we admit it … everyone else is lousy too, but most people won’t admit it.
–Martin Whitman
14. There’s a virtuous cycle when people have to defend challenges to their ideas. Any gaps in thinking or analysis become clear pretty quickly when smart people ask good, logical questions. You can’t be a good value investor without being an independent thinker – you’re seeing valuations that the market is not appreciating. But it’s critical that you understand why the market isn’t seeing the value you do. The back and forth that goes on in the investment process helps you get at that.
–Joel Greenblatt
15. The stock market is the story of cycles and of the human behavior that is responsible for overreactions in both directions.
–Seth Klarman
16. Generally, the greater the stigma or revulsion, the better the bargain.
–Seth Klarman
17. If you are shopping for common stocks, choose them the way you would buy groceries, not the way you would buy perfume.
–Benjamin Graham
18. Risk comes from not knowing what you’re doing.
–Warren Buffett
19. Investing is the intersection of economics and psychology.
–Seth Klarman
20. We don’t have to be smarter than the rest. We have to be more disciplined than the rest.
–Warren Buffett
21. Confronted with a challenge to distill the secret of sound investment into three words, we venture the motto, Margin of Safety.
–Ben Graham
22. Value investing is risk aversion.
–Seth Klarman
23. Value investing is at its core the marriage of a contrarian streak and a calculator.
–Seth Klarman
24. Cash combined with courage in a time of crisis is priceless.
–Warren Buffett
25. It is remarkable how much long-term advantage people like us have gotten by trying to be consistently not stupid, instead of trying to be very intelligent.
–Charlie Munger
26. Our job is to find a few intelligent things to do, not to keep up with every damn thing in the world.
–Charlie Munger
27. In the short run, the market is a voting machine, but in the long run it is a weighing machine.
–Ben Graham
28. All intelligent investing is value investing — acquiring more that you are paying for. You must value the business in order to value the stock.
–Charlie Munger
29. While some might mistakenly consider value investing a mechanical tool for identifying bargains, it is actually a comprehensive investment philosophy that emphasizes the need to perform in-depth fundamental analysis, pursue long-term investment results, limit risk, and resist crowd psychology.
–Seth Klarman
30. Buy not on optimism, but on arithmetic.
–Benjamin Graham
31. As in roulette, same is true of the stock trader, who will find that the expense of trading weights the dice heavily against him.
–Benjamin Graham
32. If you have more than 120 or 130 I.Q. points, you can afford to give the rest away. You don’t need extraordinary intelligence to succeed as an investor.
–Warren Buffett
33. If you don’t study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.
–Peter Lynch
34. In the long run, it’s not just how much money you make that will determine your future prosperity. It’s how much of that money you put to work by saving it and investing it.
–Peter Lynch
35. Unless you can watch your stock holding decline by 50% without becoming panic-stricken, you should not be in the stock market.
–Warren Buffett
36. Wide diversification is only required when investors do not understand what they are doing.
–Warren Buffett
37. If investing is entertaining, if you’re having fun, you’re probably not making any money. Good investing is boring.
–George Soros
38. Go for a business that any idiot can run – because sooner or later, any idiot probably is going to run it.
–Peter Lynch
39. If you are not willing to own a stock for 10 years, do not even think about owning it for 10 minutes.
–Warren Buffett
40. Calling someone who trades actively in the market an investor is like calling someone who repeatedly engages in one-night stands a romantic.
–Warren Buffet
41. Although it’s easy to forget sometimes, a share is not a lottery ticket… it’s part-ownership of a business.
–Peter Lynch
–Warren Buffett (This was actually told Warren Buffett by his teacher cum boss, Benjamin Graham - TopTrader)
2. Rule No.1: Never lose money. Rule No.2: Never forget rule No.1.
–Warren Buffett
3. If you’re prepared to invest in a company, you ought to be able to explain why in simple language that a fifth grader could understand, and quickly enough so the fifth grader won’t get bored.
–Peter Lynch
4. Behind every stock is a company. Find out what it’s doing.
–Peter Lynch
5. While it might seem that anyone can be a value investor, the essential characteristics of this type of investor-patience, discipline, and risk aversion-may well be genetically determined.
–Seth Klarmans
6. Twenty years in this business convinces me that any normal person using the customary three percent of the brain can pick stocks just as well, if not better, than the average Wall Street expert.
–Peter Lynch
7. The underlying principles of sound investment should not alter from decade to decade, but the application of these principles must be adapted to significant changes in the financial mechanisms and climate.
–Benjamin Graham
8. Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.
–Warren Buffett
9. We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful. -
Warren Buffett
10. The individual investor should act consistently as an investor and not as a speculator.
–Benjamin Graham
11. Know what you own, and know why you own it.
–Peter Lynch
12. Based on my own personal experience – both as an investor in recent years and an expert witness in years past – rarely do more than three or four variables really count. Everything else is noise.
–Martin Whitman
13. We ignore outlooks and forecasts… we’re lousy at it and we admit it … everyone else is lousy too, but most people won’t admit it.
–Martin Whitman
14. There’s a virtuous cycle when people have to defend challenges to their ideas. Any gaps in thinking or analysis become clear pretty quickly when smart people ask good, logical questions. You can’t be a good value investor without being an independent thinker – you’re seeing valuations that the market is not appreciating. But it’s critical that you understand why the market isn’t seeing the value you do. The back and forth that goes on in the investment process helps you get at that.
–Joel Greenblatt
15. The stock market is the story of cycles and of the human behavior that is responsible for overreactions in both directions.
–Seth Klarman
16. Generally, the greater the stigma or revulsion, the better the bargain.
–Seth Klarman
17. If you are shopping for common stocks, choose them the way you would buy groceries, not the way you would buy perfume.
–Benjamin Graham
18. Risk comes from not knowing what you’re doing.
–Warren Buffett
19. Investing is the intersection of economics and psychology.
–Seth Klarman
20. We don’t have to be smarter than the rest. We have to be more disciplined than the rest.
–Warren Buffett
21. Confronted with a challenge to distill the secret of sound investment into three words, we venture the motto, Margin of Safety.
–Ben Graham
22. Value investing is risk aversion.
–Seth Klarman
23. Value investing is at its core the marriage of a contrarian streak and a calculator.
–Seth Klarman
24. Cash combined with courage in a time of crisis is priceless.
–Warren Buffett
25. It is remarkable how much long-term advantage people like us have gotten by trying to be consistently not stupid, instead of trying to be very intelligent.
–Charlie Munger
26. Our job is to find a few intelligent things to do, not to keep up with every damn thing in the world.
–Charlie Munger
27. In the short run, the market is a voting machine, but in the long run it is a weighing machine.
–Ben Graham
28. All intelligent investing is value investing — acquiring more that you are paying for. You must value the business in order to value the stock.
–Charlie Munger
29. While some might mistakenly consider value investing a mechanical tool for identifying bargains, it is actually a comprehensive investment philosophy that emphasizes the need to perform in-depth fundamental analysis, pursue long-term investment results, limit risk, and resist crowd psychology.
–Seth Klarman
30. Buy not on optimism, but on arithmetic.
–Benjamin Graham
31. As in roulette, same is true of the stock trader, who will find that the expense of trading weights the dice heavily against him.
–Benjamin Graham
32. If you have more than 120 or 130 I.Q. points, you can afford to give the rest away. You don’t need extraordinary intelligence to succeed as an investor.
–Warren Buffett
33. If you don’t study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.
–Peter Lynch
34. In the long run, it’s not just how much money you make that will determine your future prosperity. It’s how much of that money you put to work by saving it and investing it.
–Peter Lynch
35. Unless you can watch your stock holding decline by 50% without becoming panic-stricken, you should not be in the stock market.
–Warren Buffett
36. Wide diversification is only required when investors do not understand what they are doing.
–Warren Buffett
37. If investing is entertaining, if you’re having fun, you’re probably not making any money. Good investing is boring.
–George Soros
38. Go for a business that any idiot can run – because sooner or later, any idiot probably is going to run it.
–Peter Lynch
39. If you are not willing to own a stock for 10 years, do not even think about owning it for 10 minutes.
–Warren Buffett
40. Calling someone who trades actively in the market an investor is like calling someone who repeatedly engages in one-night stands a romantic.
–Warren Buffet
41. Although it’s easy to forget sometimes, a share is not a lottery ticket… it’s part-ownership of a business.
–Peter Lynch
Labels: Investment Quote, Warren Buffett
The Top 22 Investment Quotes
Warren Buffett (Net Worth $39 Billion) – “‘Price is what you pay; value is what you get.’ Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down.”
George Soros (Net Worth $22 Billion) - ”I’m only rich because I know when I’m wrong…I basically have survived by recognizing my mistakes.”
Carl Icahn (Net Worth $13 Billion) - “You learn in this business: If you want a friend, get a dog”
David Rubenstein (Net Worth $2.8 Billion) – “Persist – don’t take no for an answer. If you’re happy to sit at your desk and not take any risk, you’ll be sitting at your desk for the next 20 years.”
Ray Dalio (Net Worth $6.5 Billion) – “More than anything else, what differentiates people who live up to their potential from those who don’t is a willingness to look at themselves and others objectively.”
Alisher Usmanov (Net Worth $18.1 Billion) - ”First of all I trust my own instinct, experience that I gained over years and feeling when the moment is right for buying shares. That is what one calls intuition.
Carlos Slim (Net Worth $69 Billion) - “Anyone who is not investing now is missing a tremendous opportunity.”
Eddie Lampert (Net Worth $3 Billion) – “This idea of anticipation is key to investing and to business generally. You can’t wait for an opportunity to become obvious. You have to think, “Here’s what other people and companies have done under certain circumstances. Now, under these new circumstances, how is this management likely to behave?”
T. Boone Pickens (Net Worth $1.4 Billion) - “The older I get, the more I see a straight path where I want to go. If you’re going to hunt elephants, don’t get off the trail for a rabbit.”
Charlie Munger (Net Worth $1 Billion) – “If you took our top fifteen decisions out, we’d have a pretty average record. It wasn’t hyperactivity, but a hell of a lot of patience. You stuck to your principles and when opportunities came along, you pounced on them with vigor.”
Jim Cramer (Net Worth $100 Million) - “As long as you enjoy investing, you’ll be willing to do the homework and stay in the game. That’s why I try to make the show so entertaining, because if you aren’t interested, you’ll either miss the opportunity to make money in the market or not pay enough attention and end up losing your shirt.”
Michael Milken (Net Worth $2.1 Billion) – “My experience indicates that most people who’ve accumulated a great deal of wealth haven’t had that as their goal at all. Wealth is only a by-product, not the original motivation.”
David Tepper (Net Worth $5 Billion) – “This company looks cheap, that company looks cheap, but the overall economy could completely screw it up. The key is to wait. Sometimes the hardest thing to do is to do nothing.”
Benjamin Graham – R.I.P (Net Worth Unknown) – “The individual investor should act consistently as an investor and not as a speculator. This means that he should be able to justify every purchase he makes and each price he pays by impersonal, objective reasoning that satisfies him that he is getting more than his money’s worth for his purchase.”
Louis Bacon (Net Worth $1.4 Billion) – “As a speculator you must embrace disorder and chaos.”
Paul Tudor Jones (Net Worth $3.2 Billion) - “Were you want to be is always in control, never wishing, always trading, and always, first and foremost protecting your butt. After a while size means nothing. It gets back to whether you’re making 100% rate of return on $10,000 or $100 million dollars. It doesn’t make any difference.”
Peter Thiel (Net Worth $1.5 Billion) – “Value investors look at cash flows. If a company can maintain present cash flows for 5 or 6 years, it’s a good investment. Investors then just hope that those cash flows—and thus the company’s value—don’t decrease faster than they anticipate.”
Bruce Kovner (Net Worth $4.3 Billion) - ” My experience with novice traders is that they trade three to five times too big. They are taking 5 to 10 percent risks on a trade when they should be taking 1 to 2 percent risks. The emotional burden of trading is substantial; on any given day, I could lose millions of dollars. If you personalize these losses, you can’t trade.”
Rene Rivkin (Net Worth $346 Million) - “When buying shares, ask yourself, would you buy the whole company?”
Peter Lynch (Net Worth $352 Million) – “I think you have to learn that there’s a company behind every stock, and that there’s only one real reason why stocks go up. Companies go from doing poorly to doing well or small companies grow to large companies.”
John Templeton (Net Worth $20 Billion)- “The time of maximum pessimism is the best time to buy and the time of maximum optimism is the best time to sell.”
John (Jack) Bogle (Net Worth $4 Billion) - “If you have trouble imagining a 20% loss in the stock market, you shouldn’t be in stocks.”
George Soros (Net Worth $22 Billion) - ”I’m only rich because I know when I’m wrong…I basically have survived by recognizing my mistakes.”
Carl Icahn (Net Worth $13 Billion) - “You learn in this business: If you want a friend, get a dog”
David Rubenstein (Net Worth $2.8 Billion) – “Persist – don’t take no for an answer. If you’re happy to sit at your desk and not take any risk, you’ll be sitting at your desk for the next 20 years.”
Ray Dalio (Net Worth $6.5 Billion) – “More than anything else, what differentiates people who live up to their potential from those who don’t is a willingness to look at themselves and others objectively.”
Alisher Usmanov (Net Worth $18.1 Billion) - ”First of all I trust my own instinct, experience that I gained over years and feeling when the moment is right for buying shares. That is what one calls intuition.
Carlos Slim (Net Worth $69 Billion) - “Anyone who is not investing now is missing a tremendous opportunity.”
Eddie Lampert (Net Worth $3 Billion) – “This idea of anticipation is key to investing and to business generally. You can’t wait for an opportunity to become obvious. You have to think, “Here’s what other people and companies have done under certain circumstances. Now, under these new circumstances, how is this management likely to behave?”
T. Boone Pickens (Net Worth $1.4 Billion) - “The older I get, the more I see a straight path where I want to go. If you’re going to hunt elephants, don’t get off the trail for a rabbit.”
Charlie Munger (Net Worth $1 Billion) – “If you took our top fifteen decisions out, we’d have a pretty average record. It wasn’t hyperactivity, but a hell of a lot of patience. You stuck to your principles and when opportunities came along, you pounced on them with vigor.”
Jim Cramer (Net Worth $100 Million) - “As long as you enjoy investing, you’ll be willing to do the homework and stay in the game. That’s why I try to make the show so entertaining, because if you aren’t interested, you’ll either miss the opportunity to make money in the market or not pay enough attention and end up losing your shirt.”
Michael Milken (Net Worth $2.1 Billion) – “My experience indicates that most people who’ve accumulated a great deal of wealth haven’t had that as their goal at all. Wealth is only a by-product, not the original motivation.”
David Tepper (Net Worth $5 Billion) – “This company looks cheap, that company looks cheap, but the overall economy could completely screw it up. The key is to wait. Sometimes the hardest thing to do is to do nothing.”
Benjamin Graham – R.I.P (Net Worth Unknown) – “The individual investor should act consistently as an investor and not as a speculator. This means that he should be able to justify every purchase he makes and each price he pays by impersonal, objective reasoning that satisfies him that he is getting more than his money’s worth for his purchase.”
Louis Bacon (Net Worth $1.4 Billion) – “As a speculator you must embrace disorder and chaos.”
Paul Tudor Jones (Net Worth $3.2 Billion) - “Were you want to be is always in control, never wishing, always trading, and always, first and foremost protecting your butt. After a while size means nothing. It gets back to whether you’re making 100% rate of return on $10,000 or $100 million dollars. It doesn’t make any difference.”
Peter Thiel (Net Worth $1.5 Billion) – “Value investors look at cash flows. If a company can maintain present cash flows for 5 or 6 years, it’s a good investment. Investors then just hope that those cash flows—and thus the company’s value—don’t decrease faster than they anticipate.”
Bruce Kovner (Net Worth $4.3 Billion) - ” My experience with novice traders is that they trade three to five times too big. They are taking 5 to 10 percent risks on a trade when they should be taking 1 to 2 percent risks. The emotional burden of trading is substantial; on any given day, I could lose millions of dollars. If you personalize these losses, you can’t trade.”
Rene Rivkin (Net Worth $346 Million) - “When buying shares, ask yourself, would you buy the whole company?”
Peter Lynch (Net Worth $352 Million) – “I think you have to learn that there’s a company behind every stock, and that there’s only one real reason why stocks go up. Companies go from doing poorly to doing well or small companies grow to large companies.”
John Templeton (Net Worth $20 Billion)- “The time of maximum pessimism is the best time to buy and the time of maximum optimism is the best time to sell.”
John (Jack) Bogle (Net Worth $4 Billion) - “If you have trouble imagining a 20% loss in the stock market, you shouldn’t be in stocks.”
Labels: Investment Quote, Warren Buffett
十年一觉股市梦，赢得“理财专家”名
来源: 一天钓鱼，两天上网 于 2013-05-10
昨晚看了一下投资笔记，为退休自愿投资始于2002年年初，是在拿到了绿卡，搬进了自住房之后。第一笔投进股市的钱是太太和我的traditional IRA, 算2001年的contribution。十年股市的沉浮，回头看：
1。当年读了无数Scott Burns的专栏文章，看着股市从高点走向崩溃，带着初试嘀声的兴奋，期盼着每年8-9%的回报（那是当时Burns 的Couch Potato portfolio的回报平均值呀），憧憬着早日退休的美国梦，毅然决然地走进了股市。十年过去了，昨晚计算了自己十年的平均回报：十年总共投进股市以100计算，到昨天有134的总数。如果把每年投进股市的钱平均下来计算，俺居然只有5%多一点的年平均回报率（把俺前期投入少，后期投入多的因素考虑进去，实际上该多一点，勉强有6%吧。）。俺可是在2002年年初股市最低迷的时候进去的，也力所能及地以DCA方式投入。8-9%依然只能是梦想。
2。进股市的钱确实要分清长期和短期。这退休的钱是至少20年才考虑用的，经得起股市的折腾。但股市的不可预料，就是20年，也得考虑出来的时间和方式。工薪阶层为退休进股市的方式是没有选择的DCA, 但出来的方式和时间还是得自己作决定的。所以，这十年的股市起伏实际上给我上了一课。还有五年，就要付之于行动了。可短期放进股市的钱，一定得选好进出股市的时间。俺2004年拿俺给女儿准备上大学的钱赌了一把，2006年感恩节前后出来，比女儿实际需要用那笔钱提前了两年，有40%的return。那时确实是看到股市低迷了那么久，往上走的潜力大得多才敢下手的。没吃到鱼头，也没吃到鱼尾。但现在回头看，短期投进股市的钱一定要找好机会，也不能贪。
3。虽然回报远不如预期，但现在的实际情况还是走在了计划的前面。主要是投入比原计划的要大得多。我的家庭理财计划是比较保守的，总留有余地。所以，这些年虽要供女儿上大学，但还是省吃俭用，最大限度地往退休计划里存，并直接投进股市。连股市低迷的2008，2009也没有退缩。知道自己判断股市走向的能力有限，只能闭着眼睛投。多少次和太太面对面，看着每月的报表上数字越来越小，心里打起了退堂鼓。但总会在相互确认工作暂时没有问题的情况下继续。计划的时候往往还年青，在工作上还是上升阶段，所以，大多数人还是会在计划执行过程中发现调整的余地。
4。多读家庭理财的书和文章，一方面会让人失去冒险的精神，但另一方面会让人更加稳健。历史是一面镜子，让人思考。读"漫步华尔街"的前面几个章节，学到了股市历史上几个bubble的成因。后人看当年荷兰的tulip bubble，多么愚蠢和可笑，但和2000年的股市bubble比，多少相似的地方！时代是变了，tulip bulbs换成了technology,但不变的是人性和herd mentality。这些书在让我失去了冲劲和冒险的冲动的同时，也让我在低迷的时候看到了希望。Warren Buffet说：在别人贪婪的时候我们需要恐惧，当别人恐惧的时候你要学会贪婪！不得说他是股市里的老狐狸（没有不尊重的意思），他的成功不是偶然的。
5。家庭理财实际上是在下一盘棋。涉及的东西很多，从税收到孩子大学学费的准备，从家里的油盐柴米等日常开销到房贷车贷，样样都可以是你计划的一个考虑因素。十年的最大改变就是学会了计划预算和记录。纸上谈兵太容易，只有开始了计划预算，开始了行动才会有记录，才能真正学到东西。今天在大千碰到有人问：前不久买了一个股票今天大涨，原因是公司因美国"财政悬崖"而提前分红。他问他该现在卖掉股票呢还是等分红之后再卖。俺没有能力预测从现在到分红时股票的走向，但俺知道分红和short-term capital gain在税法上的不同。这对不同的人可以有完全不同的答案，这不正是美国"财政悬崖"导致股市起伏的原因么。所以，十年前理财是一个一个家庭理财小计划分开看，今天知道了自己是在下一盘棋，每一步其实都是有关联的。
6。十年，从股市的旁观者变成了炒股人。买基金其实是股市的旁观者，你没有真正参与的。十年，有八年是旁观者。去年开始了"炒"。虽然无孔兄（nonconfusion)从来不传我他炒股的绝技，但他也认为我是炒股票的料--亏损尽付谈笑间。炒有炒的乐趣，让平淡的家庭理财多了一份心跳，也能感觉一下股市的脉搏，更让我多了一些现金在手，也就多了一份抗跌的能力。两年炒股虽然只赚了点酒钱（和不炒比），但大多数时候手上有10%的现金。没有也是因为赚了酒钱才进去的。在股市又开始走向下一个高点的时候，我是该有一定量的现金在手了。而不是象2008年那样，随股市颠簸。和太太开玩笑，我怎么也会保持至少50%的钱在股市里，股市平稳时会保持80%以上。但炒股赚的钱的10%还是该我买酒喝的。
十年一觉股市梦，但愿俺水波不兴的海外华人生活多些心跳。
（二0一二年十一月二十八日）
昨晚看了一下投资笔记，为退休自愿投资始于2002年年初，是在拿到了绿卡，搬进了自住房之后。第一笔投进股市的钱是太太和我的traditional IRA, 算2001年的contribution。十年股市的沉浮，回头看：
1。当年读了无数Scott Burns的专栏文章，看着股市从高点走向崩溃，带着初试嘀声的兴奋，期盼着每年8-9%的回报（那是当时Burns 的Couch Potato portfolio的回报平均值呀），憧憬着早日退休的美国梦，毅然决然地走进了股市。十年过去了，昨晚计算了自己十年的平均回报：十年总共投进股市以100计算，到昨天有134的总数。如果把每年投进股市的钱平均下来计算，俺居然只有5%多一点的年平均回报率（把俺前期投入少，后期投入多的因素考虑进去，实际上该多一点，勉强有6%吧。）。俺可是在2002年年初股市最低迷的时候进去的，也力所能及地以DCA方式投入。8-9%依然只能是梦想。
2。进股市的钱确实要分清长期和短期。这退休的钱是至少20年才考虑用的，经得起股市的折腾。但股市的不可预料，就是20年，也得考虑出来的时间和方式。工薪阶层为退休进股市的方式是没有选择的DCA, 但出来的方式和时间还是得自己作决定的。所以，这十年的股市起伏实际上给我上了一课。还有五年，就要付之于行动了。可短期放进股市的钱，一定得选好进出股市的时间。俺2004年拿俺给女儿准备上大学的钱赌了一把，2006年感恩节前后出来，比女儿实际需要用那笔钱提前了两年，有40%的return。那时确实是看到股市低迷了那么久，往上走的潜力大得多才敢下手的。没吃到鱼头，也没吃到鱼尾。但现在回头看，短期投进股市的钱一定要找好机会，也不能贪。
3。虽然回报远不如预期，但现在的实际情况还是走在了计划的前面。主要是投入比原计划的要大得多。我的家庭理财计划是比较保守的，总留有余地。所以，这些年虽要供女儿上大学，但还是省吃俭用，最大限度地往退休计划里存，并直接投进股市。连股市低迷的2008，2009也没有退缩。知道自己判断股市走向的能力有限，只能闭着眼睛投。多少次和太太面对面，看着每月的报表上数字越来越小，心里打起了退堂鼓。但总会在相互确认工作暂时没有问题的情况下继续。计划的时候往往还年青，在工作上还是上升阶段，所以，大多数人还是会在计划执行过程中发现调整的余地。
4。多读家庭理财的书和文章，一方面会让人失去冒险的精神，但另一方面会让人更加稳健。历史是一面镜子，让人思考。读"漫步华尔街"的前面几个章节，学到了股市历史上几个bubble的成因。后人看当年荷兰的tulip bubble，多么愚蠢和可笑，但和2000年的股市bubble比，多少相似的地方！时代是变了，tulip bulbs换成了technology,但不变的是人性和herd mentality。这些书在让我失去了冲劲和冒险的冲动的同时，也让我在低迷的时候看到了希望。Warren Buffet说：在别人贪婪的时候我们需要恐惧，当别人恐惧的时候你要学会贪婪！不得说他是股市里的老狐狸（没有不尊重的意思），他的成功不是偶然的。
5。家庭理财实际上是在下一盘棋。涉及的东西很多，从税收到孩子大学学费的准备，从家里的油盐柴米等日常开销到房贷车贷，样样都可以是你计划的一个考虑因素。十年的最大改变就是学会了计划预算和记录。纸上谈兵太容易，只有开始了计划预算，开始了行动才会有记录，才能真正学到东西。今天在大千碰到有人问：前不久买了一个股票今天大涨，原因是公司因美国"财政悬崖"而提前分红。他问他该现在卖掉股票呢还是等分红之后再卖。俺没有能力预测从现在到分红时股票的走向，但俺知道分红和short-term capital gain在税法上的不同。这对不同的人可以有完全不同的答案，这不正是美国"财政悬崖"导致股市起伏的原因么。所以，十年前理财是一个一个家庭理财小计划分开看，今天知道了自己是在下一盘棋，每一步其实都是有关联的。
6。十年，从股市的旁观者变成了炒股人。买基金其实是股市的旁观者，你没有真正参与的。十年，有八年是旁观者。去年开始了"炒"。虽然无孔兄（nonconfusion)从来不传我他炒股的绝技，但他也认为我是炒股票的料--亏损尽付谈笑间。炒有炒的乐趣，让平淡的家庭理财多了一份心跳，也能感觉一下股市的脉搏，更让我多了一些现金在手，也就多了一份抗跌的能力。两年炒股虽然只赚了点酒钱（和不炒比），但大多数时候手上有10%的现金。没有也是因为赚了酒钱才进去的。在股市又开始走向下一个高点的时候，我是该有一定量的现金在手了。而不是象2008年那样，随股市颠簸。和太太开玩笑，我怎么也会保持至少50%的钱在股市里，股市平稳时会保持80%以上。但炒股赚的钱的10%还是该我买酒喝的。
十年一觉股市梦，但愿俺水波不兴的海外华人生活多些心跳。
（二0一二年十一月二十八日）
Labels: Reference, Warren Buffett
14 September 2013
5 Simple Ways to Invest Like a Pro
By Rob Berger
One of the best-kept secrets on Wall Street is one your broker hopes you never uncover— figuring out how to invest like a pro is really easy. In fact, any investor can build a well-diversified portfolio of stocks and bonds with little effort. It doesn’t require great expense, extensive knowledge of the market, or even a lot of time.
1. Keep it simple.
Investing does not have to be complicated. While some investors choose to buy individual stocks and bonds, for most of us, a couple of low-cost index funds will suffice. Even Warren Buffett recommends index funds as reflected in his 1996 letter to Berkshire Hathaway shareholders:
Most investors, both institutional and individual, will find that the best way to own common stocks is through an index fund that charges minimal fees.Those following this path are sure to beat the net results (after fees and expense) delivered by the great majority of investment professionals. Seriously, costs matter. - Warren Buffett
Taken to its extreme, an investor can build a diversified investment portfolio from a single target-date mutual fund.
2. Go cheap.
As Warren Buffett noted in his letter quoted above, “costs matter.” Unfortunately, it’s easy to ignore costs when it comes to investing. Mutual funds do not send out a monthly bill for investors to pay. Instead, funds simply subtract the fees from the assets it holds. Yet even relatively small annual expenses, multiplied over a lifetime of investing, can make a serious dent in your nest egg.
Expenses that lower investment returns even one-half of a percent, for example, can result in substantially less money at retirement. The key is to invest in low cost stock index ETFs. Many index funds today cost less than 10 basis points (0.10 percent).
3. Invest with a plan.
A sound investment plan is simple to create. With the help of index funds, an investor can devise a simple asset allocation plan between stocks and bonds. Many suggest an investor should own her age in bonds, with the rest in stocks. For example, a 25-year-old would allocate 25 percent of her investments to bonds and 75 percent to stocks. Others suggest a more aggressive approach of owning a percentage of stocks equal to 120 minus your age. Regardless, choose a plan and stick with it.
Following an investment plan helps investors stay the course during difficult times. An investor in his 20s will undoubtedly experience significant bear markets over the next 50 years.Stocks will likely experience one-year losses of 20 to 30 percent several times over the next half-century. A sound investment plan will help an investor weather these storms.
4. Have no fear (or greed).
Fear and greed are two emotions that do not mix well with sound investing. When the stock market is moving up, many investors jump on the bandwagon in hopes of making a quick buck. When stocks eventually fall, those same investors run for the exit. The result is a repeating pattern of buying high and selling low.
Ideally, investors should do just the opposite. A bear market is an ideal time to buy stocks. A quick look back to 2008 and 2009 reveals many stocks that could have been purchased from the bargain racks. At a minimum, however, investors should avoid buying and selling based on the daily, monthly, or yearly fluctuations of the market. Following an investment plan as described above will help.
5. Track your results.
Tracking results is critical. As the price of investments fluctuates, investors will need to rebalance their investments periodically to keep them inline with their investment plan. As an investor nears his investment goal, such as retirement, changes may need to be made to the asset allocation plan. And the cost of investments should always be monitored.
Fortunately, there are many online tools that enable investors to track a portfolio for free. The one I use daily is called Personal Capital. It automatically imports investments from 401(k), IRA and other retirement accounts, as well as non-retirement accounts. It displays the asset allocation of a portfolio along with the total cost of the investments. Regardless of the tool used, however, the key is to monitor an investment portfolio regularly.
With these five tips, anybody can invest like a pro.
Rob Berger is the founder of the popular personal finance blog, the Dough Roller.
One of the best-kept secrets on Wall Street is one your broker hopes you never uncover— figuring out how to invest like a pro is really easy. In fact, any investor can build a well-diversified portfolio of stocks and bonds with little effort. It doesn’t require great expense, extensive knowledge of the market, or even a lot of time.
1. Keep it simple.
Investing does not have to be complicated. While some investors choose to buy individual stocks and bonds, for most of us, a couple of low-cost index funds will suffice. Even Warren Buffett recommends index funds as reflected in his 1996 letter to Berkshire Hathaway shareholders:
Most investors, both institutional and individual, will find that the best way to own common stocks is through an index fund that charges minimal fees.Those following this path are sure to beat the net results (after fees and expense) delivered by the great majority of investment professionals. Seriously, costs matter. - Warren Buffett
Taken to its extreme, an investor can build a diversified investment portfolio from a single target-date mutual fund.
2. Go cheap.
As Warren Buffett noted in his letter quoted above, “costs matter.” Unfortunately, it’s easy to ignore costs when it comes to investing. Mutual funds do not send out a monthly bill for investors to pay. Instead, funds simply subtract the fees from the assets it holds. Yet even relatively small annual expenses, multiplied over a lifetime of investing, can make a serious dent in your nest egg.
Expenses that lower investment returns even one-half of a percent, for example, can result in substantially less money at retirement. The key is to invest in low cost stock index ETFs. Many index funds today cost less than 10 basis points (0.10 percent).
3. Invest with a plan.
A sound investment plan is simple to create. With the help of index funds, an investor can devise a simple asset allocation plan between stocks and bonds. Many suggest an investor should own her age in bonds, with the rest in stocks. For example, a 25-year-old would allocate 25 percent of her investments to bonds and 75 percent to stocks. Others suggest a more aggressive approach of owning a percentage of stocks equal to 120 minus your age. Regardless, choose a plan and stick with it.
Following an investment plan helps investors stay the course during difficult times. An investor in his 20s will undoubtedly experience significant bear markets over the next 50 years.Stocks will likely experience one-year losses of 20 to 30 percent several times over the next half-century. A sound investment plan will help an investor weather these storms.
4. Have no fear (or greed).
Fear and greed are two emotions that do not mix well with sound investing. When the stock market is moving up, many investors jump on the bandwagon in hopes of making a quick buck. When stocks eventually fall, those same investors run for the exit. The result is a repeating pattern of buying high and selling low.
Ideally, investors should do just the opposite. A bear market is an ideal time to buy stocks. A quick look back to 2008 and 2009 reveals many stocks that could have been purchased from the bargain racks. At a minimum, however, investors should avoid buying and selling based on the daily, monthly, or yearly fluctuations of the market. Following an investment plan as described above will help.
5. Track your results.
Tracking results is critical. As the price of investments fluctuates, investors will need to rebalance their investments periodically to keep them inline with their investment plan. As an investor nears his investment goal, such as retirement, changes may need to be made to the asset allocation plan. And the cost of investments should always be monitored.
Fortunately, there are many online tools that enable investors to track a portfolio for free. The one I use daily is called Personal Capital. It automatically imports investments from 401(k), IRA and other retirement accounts, as well as non-retirement accounts. It displays the asset allocation of a portfolio along with the total cost of the investments. Regardless of the tool used, however, the key is to monitor an investment portfolio regularly.
With these five tips, anybody can invest like a pro.
Rob Berger is the founder of the popular personal finance blog, the Dough Roller.
Labels: ETF, Stock Trading System, Warren Buffett
29 August 2013
40 Investing Quotes To Lead You Through Any Market
1. Those with the enterprise lack the money and those with the money lack the enterprise to buy stocks when they are cheap. -Benjamin Graham
2. A business that makes nothing but money is a poor business. -Henry Ford
3. Experience taught me a few things. One is to listen to your gut, no matter how good something sounds on paper. The second is that you're generally better off sticking with what you know. And the third is that sometimes your best investments are the ones you don't make. -Donald Trump
4. After all, the chief business of the American people is business. They are profoundly concerned with producing, buying, selling, investing and prospering in the world. -Calvin Coolidge
5. "Investing should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas. -Paul Samuelson
6. If investing is entertaining, if you're having fun, you're probably not making any money. Good investing is boring. -George Soros
7. I believe that thrift is essential to well-ordered living and that economy is a prime request of a sound financial structure, whether in government, business or personal affairs. -John D. Rockefeller, Jr.
8. I'd like to live as a poor man with lots of money. -Pablo Picasso
9. And finally, no matter how good the science gets, there are problems that inevitably depend on judgment, on art, on a feel for financial markets. -Martin Feldstein
10. As financial markets continue to broaden and deepen, the behavior of asset prices will play an important role in the formulation of monetary policy going forward, perhaps a more important role than in the past. -Timothy Geithner
11. Being on a movie set is like one long financial crisis. -John Cusack
12. Rule No.1: Never lose money. Rule No.2: Never forget rule No.1. -Warren Buffett
13. Columbus did not seek a new route to the Indies in response to a majority directive. -Milton Friedman
14. Markets can remain irrational longer than you can remain solvent. -John Maynard Keynes
15. October: This is one of the peculiarly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February. -Mark Twain
16. The four most dangerous words in investing are "This time it's different." -John Templeton
17. If you have trouble imagining a 20% loss in the stock market, you shouldn't be in stocks. -John Bogle
18. Blaming speculators as a response to financial crisis goes back at least to the Greeks. It's almost always the wrong response. -Larry Summers
19. Derivatives are financial weapons of mass destruction. -Warren Buffett
20. We've used derivatives for many, many years. I don't think derivatives are evil, per se, I think they are dangerous. …So we use lots of things daily that are dangerous, but we generally pay some attention to how they're used. We tell the cars how fast they can go. -Warren Buffett
21. If I’d only followed CNBC’s advice, I’d have a million dollars today. Provided I’d started with a hundred million dollars. -Jon Stewart
22. So you think that money is the root of all evil. Have you ever asked what is the root of all money? -Ayn Rand
23. Put not your trust in money, but put your money in trust. -Oliver Wendell Holmes
24. When I was young I thought that money was the most important thing in life; now that I am old I know that it is. -Oscar Wilde
25. Money is better than poverty, if only for financial reasons. -Woody Allen
26. If all the economists were laid end to end, they'd never reach a conclusion. -George Bernard Shaw
27. When an investor focuses on short-term investments, he or she is observing the variability of the portfolio, not the returns - in short, being fooled by randomness. -Nassim Nicholas Taleb
28. Everyone has the brainpower to make money in stocks. Not everyone has the stomach. If you are susceptible to selling everything in a panic, you ought to avoid stocks and mutual funds altogether. -Peter Lynch
29. Most investors want to do today what they should have done yesterday. -Larry Summers
30. Cash is a fact, profit is an opinion. -Alfred Rappaport
31. Money is like manure. You have to spread it around or it smells. -J. Paul Getty
32. I don't like money, actually, but it quiets my nerves. -Joe Louis
33. Budget: a mathematical confirmation of your suspicions. -A.A. Latimer
34. Stock price movements actually begin to reflect new developments before it is generally recognized that they have taken place. -Arthur Zeikel
35. A collapse in U.S. stock prices certainly would cause a lot of white knuckles on Wall Street. But what effect would it have on the broader U.S. economy? If Wall Street crashes, does Main Street follow? Not necessarily. -Ben Bernanke
36. I guess I should warn you, if I turn out to be particularly clear, you've probably misunderstood what I've said. -Alan Greenspan
37. The United States in particular and the West in general should be feeling a little embarrassed about all that lecturing we did to the Third World. -Paul Krugman
38. Just as a cautious businessman avoids investing all his capital in one concern, so wisdom would probably admonish us also not to anticipate all our happiness from one quarter alone. -Sigmund Freud
39. People don't like the idea of thinking long term. Many are desperately seeking short term answers because they have money problems to be solved today. -Robert Kiyosaki
40. Financial peace isn't the acquisition of stuff. It's learning to live on less than you make, so you can give money back and have money to invest. You can't win until you do this. -Dave Ramsey
2. A business that makes nothing but money is a poor business. -Henry Ford
3. Experience taught me a few things. One is to listen to your gut, no matter how good something sounds on paper. The second is that you're generally better off sticking with what you know. And the third is that sometimes your best investments are the ones you don't make. -Donald Trump
4. After all, the chief business of the American people is business. They are profoundly concerned with producing, buying, selling, investing and prospering in the world. -Calvin Coolidge
5. "Investing should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas. -Paul Samuelson
6. If investing is entertaining, if you're having fun, you're probably not making any money. Good investing is boring. -George Soros
7. I believe that thrift is essential to well-ordered living and that economy is a prime request of a sound financial structure, whether in government, business or personal affairs. -John D. Rockefeller, Jr.
8. I'd like to live as a poor man with lots of money. -Pablo Picasso
9. And finally, no matter how good the science gets, there are problems that inevitably depend on judgment, on art, on a feel for financial markets. -Martin Feldstein
10. As financial markets continue to broaden and deepen, the behavior of asset prices will play an important role in the formulation of monetary policy going forward, perhaps a more important role than in the past. -Timothy Geithner
11. Being on a movie set is like one long financial crisis. -John Cusack
12. Rule No.1: Never lose money. Rule No.2: Never forget rule No.1. -Warren Buffett
13. Columbus did not seek a new route to the Indies in response to a majority directive. -Milton Friedman
14. Markets can remain irrational longer than you can remain solvent. -John Maynard Keynes
15. October: This is one of the peculiarly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February. -Mark Twain
16. The four most dangerous words in investing are "This time it's different." -John Templeton
17. If you have trouble imagining a 20% loss in the stock market, you shouldn't be in stocks. -John Bogle
18. Blaming speculators as a response to financial crisis goes back at least to the Greeks. It's almost always the wrong response. -Larry Summers
19. Derivatives are financial weapons of mass destruction. -Warren Buffett
20. We've used derivatives for many, many years. I don't think derivatives are evil, per se, I think they are dangerous. …So we use lots of things daily that are dangerous, but we generally pay some attention to how they're used. We tell the cars how fast they can go. -Warren Buffett
21. If I’d only followed CNBC’s advice, I’d have a million dollars today. Provided I’d started with a hundred million dollars. -Jon Stewart
22. So you think that money is the root of all evil. Have you ever asked what is the root of all money? -Ayn Rand
23. Put not your trust in money, but put your money in trust. -Oliver Wendell Holmes
24. When I was young I thought that money was the most important thing in life; now that I am old I know that it is. -Oscar Wilde
25. Money is better than poverty, if only for financial reasons. -Woody Allen
26. If all the economists were laid end to end, they'd never reach a conclusion. -George Bernard Shaw
27. When an investor focuses on short-term investments, he or she is observing the variability of the portfolio, not the returns - in short, being fooled by randomness. -Nassim Nicholas Taleb
28. Everyone has the brainpower to make money in stocks. Not everyone has the stomach. If you are susceptible to selling everything in a panic, you ought to avoid stocks and mutual funds altogether. -Peter Lynch
29. Most investors want to do today what they should have done yesterday. -Larry Summers
30. Cash is a fact, profit is an opinion. -Alfred Rappaport
31. Money is like manure. You have to spread it around or it smells. -J. Paul Getty
32. I don't like money, actually, but it quiets my nerves. -Joe Louis
33. Budget: a mathematical confirmation of your suspicions. -A.A. Latimer
34. Stock price movements actually begin to reflect new developments before it is generally recognized that they have taken place. -Arthur Zeikel
35. A collapse in U.S. stock prices certainly would cause a lot of white knuckles on Wall Street. But what effect would it have on the broader U.S. economy? If Wall Street crashes, does Main Street follow? Not necessarily. -Ben Bernanke
36. I guess I should warn you, if I turn out to be particularly clear, you've probably misunderstood what I've said. -Alan Greenspan
37. The United States in particular and the West in general should be feeling a little embarrassed about all that lecturing we did to the Third World. -Paul Krugman
38. Just as a cautious businessman avoids investing all his capital in one concern, so wisdom would probably admonish us also not to anticipate all our happiness from one quarter alone. -Sigmund Freud
39. People don't like the idea of thinking long term. Many are desperately seeking short term answers because they have money problems to be solved today. -Robert Kiyosaki
40. Financial peace isn't the acquisition of stuff. It's learning to live on less than you make, so you can give money back and have money to invest. You can't win until you do this. -Dave Ramsey
Labels: Investment Quote, Warren Buffett
27 August 2013
The Top 17 Investing Quotes of All Time
1. "An investment in knowledge pays the best interest." - Benjamin Franklin
When it comes to investing, nothing will pay off more than educating yourself. Do the necessary research, study and analysis before making any investment decisions.
2. "Bottoms in the investment world don't end with four-year lows; they end with 10- or 15-year lows." - Jim Rogers
While 10-15 year lows are not common, they do happen. During these down times, don't be shy about going against the trend and investing; you could make a fortune by making a bold move - or lose your shirt. Remember quote #1 and invest in an industry you've researched thoroughly. Then, be prepared to see your investment sink lower before it turns around and starts to pay off.
3. "I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy only when others are fearful." - Warren Buffett
Be prepared to invest in a down market and to "get out" in a soaring market. (For more, read Think Like Warren Buffett.)
4. "The stock market is filled with individuals who know the price of everything, but the value of nothing." - Phillip Fisher
Another testament to the fact that investing without an education and research will ultimately lead to regrettable investment decisions. Research is much more than just listening to popular opinion.
5. "In investing, what is comfortable is rarely profitable." - Robert Arnott
At times, you will have to step out of your comfort zone to realize significant gains. Know the boundaries of your comfort zone and practice stepping out of it in small doses. As much as you need to know the market, you need to know yourself too. Can you handle staying in when everyone else is jumping ship? Or getting out during the biggest rally of the century? There's no room for pride in this kind of self-analysis. The best investment strategy can turn into the worst if you don't have the stomach to see it through.
6. "How many millionaires do you know who have become wealthy by investing in savings accounts? I rest my case." - Robert G. Allen
Though investing in a savings account is a sure bet, your gains will be minimal given the extremely low interest rates. But don't forgo one completely. A savings account is a reliable place for an emergency fund, whereas a market investment is not. (To learn more, see Savings Accounts Not Always The Best Place For Cash Assets.)
7. "Invest in yourself. Your career is the engine of your wealth." - Paul Clitheroe
We all want wealth, but how do we achieve it? It starts with a successful career which relies on your skills and talents. Invest in yourself through school, books, or a quality job where you can acquire a quality skill set. Identify your talents and find a way to turn them into an income-generating vehicle. In doing so, you can truly leverage your career into an "engine of your wealth."
8. "Every once in a while, the market does something so stupid it takes your breath away." - Jim Cramer
There are no sure bets in the world of investing; there is risk in everything. Be prepared for the ups and downs. (To read more on how Cramer makes his pick, see Cramer's 'Mad Money' Recap: Tools of the Trade.)
9. "The individual investor should act consistently as an investor and not as a speculator." - Ben Graham
You are an investor, not someone who can predict the future. Base your decisions on real facts and analysis rather than risky, speculative forecasts.
10. "It's not how much money you make, but how much money you keep, how hard it works for you, and how many generations you keep it for." - Robert Kiyosaki
If you're a millionaire by the time you're 30, but blow it all by age 40, you've gained nothing. Grow and protect your investment portfolio by carefully diversifying it, and you may find yourself funding many generations to come.
11. "Know what you own, and know why you own it." - Peter Lynch
Do your homework before making a decision. And once you've made a decision, make sure to re-evaluate your portfolio on a timely basis. A wise holding today may not be a wise holding in the future.
12. "Financial peace isn't the acquisition of stuff. It's learning to live on less than you make, so you can give money back and have money to invest. You can't win until you do this." - Dave Ramsey
By being modest in your spending, you can ensure you will have enough for retirement and can give back to the community as well.
13. "Investing should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas." - Paul Samuelson
If you think investing is gambling, you're doing it wrong. The work involved requires planning and patience. However, the gains you see over time are indeed exciting! (For more reasons to be patient, check out Patience Is A Trader's Virtue.)
14. "I would not pre-pay. I would invest instead and let the investments cover it." - Dave Ramsey
A perfect answer to the question: "Should I pay off my _____(fill in the blank) or invest for retirement?" That said, a credit card balance ringing up 30% can turn into a black hole if not paid off quickly. Basically, pay off debt at high interest rates and keep debt at low ones.
15. "The four most dangerous words in investing are: 'this time it's different.'" - Sir John Templeton
Follow market trends and history. Don't speculate that this particular time will be any different. For example, a major key to investing in a particular stock or bond fund is its performance over five years. Nothing shorter.
16. "Wide diversification is only required when investors do not understand what they are doing." - Warren Buffett
In the beginning, diversification is relevant. Once you've gotten your feet wet and have confidence in your investments, you can adjust your portfolio accordingly and make bigger bets. (For more reason to reduce your diversification, read The Dangers Of Over-Diversifying Your Portfolio.)
17. "You get recessions, you have stock market declines. If you don't understand that's going to happen, then you're not ready, you won't do well in the markets." - Peter Lynch
When hit with recessions or declines, you must stay the course. Economies are cyclical, and the markets have shown that they will recover. Make sure you are a part of those recoveries!
The Bottom Line
The world of investing can be cold and hard. But if you do thorough research and keep your head on straight, your chances of long-term success are good. Refer back to these quotes when you're feeling shaky or are confused about investing. How are they relevant to your experience? Do you have any favorite quotes to add? (To learn more from great investors, read Greatest Investors.)
When it comes to investing, nothing will pay off more than educating yourself. Do the necessary research, study and analysis before making any investment decisions.
2. "Bottoms in the investment world don't end with four-year lows; they end with 10- or 15-year lows." - Jim Rogers
While 10-15 year lows are not common, they do happen. During these down times, don't be shy about going against the trend and investing; you could make a fortune by making a bold move - or lose your shirt. Remember quote #1 and invest in an industry you've researched thoroughly. Then, be prepared to see your investment sink lower before it turns around and starts to pay off.
3. "I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy only when others are fearful." - Warren Buffett
Be prepared to invest in a down market and to "get out" in a soaring market. (For more, read Think Like Warren Buffett.)
4. "The stock market is filled with individuals who know the price of everything, but the value of nothing." - Phillip Fisher
Another testament to the fact that investing without an education and research will ultimately lead to regrettable investment decisions. Research is much more than just listening to popular opinion.
5. "In investing, what is comfortable is rarely profitable." - Robert Arnott
At times, you will have to step out of your comfort zone to realize significant gains. Know the boundaries of your comfort zone and practice stepping out of it in small doses. As much as you need to know the market, you need to know yourself too. Can you handle staying in when everyone else is jumping ship? Or getting out during the biggest rally of the century? There's no room for pride in this kind of self-analysis. The best investment strategy can turn into the worst if you don't have the stomach to see it through.
6. "How many millionaires do you know who have become wealthy by investing in savings accounts? I rest my case." - Robert G. Allen
Though investing in a savings account is a sure bet, your gains will be minimal given the extremely low interest rates. But don't forgo one completely. A savings account is a reliable place for an emergency fund, whereas a market investment is not. (To learn more, see Savings Accounts Not Always The Best Place For Cash Assets.)
7. "Invest in yourself. Your career is the engine of your wealth." - Paul Clitheroe
We all want wealth, but how do we achieve it? It starts with a successful career which relies on your skills and talents. Invest in yourself through school, books, or a quality job where you can acquire a quality skill set. Identify your talents and find a way to turn them into an income-generating vehicle. In doing so, you can truly leverage your career into an "engine of your wealth."
8. "Every once in a while, the market does something so stupid it takes your breath away." - Jim Cramer
There are no sure bets in the world of investing; there is risk in everything. Be prepared for the ups and downs. (To read more on how Cramer makes his pick, see Cramer's 'Mad Money' Recap: Tools of the Trade.)
9. "The individual investor should act consistently as an investor and not as a speculator." - Ben Graham
You are an investor, not someone who can predict the future. Base your decisions on real facts and analysis rather than risky, speculative forecasts.
10. "It's not how much money you make, but how much money you keep, how hard it works for you, and how many generations you keep it for." - Robert Kiyosaki
If you're a millionaire by the time you're 30, but blow it all by age 40, you've gained nothing. Grow and protect your investment portfolio by carefully diversifying it, and you may find yourself funding many generations to come.
11. "Know what you own, and know why you own it." - Peter Lynch
Do your homework before making a decision. And once you've made a decision, make sure to re-evaluate your portfolio on a timely basis. A wise holding today may not be a wise holding in the future.
12. "Financial peace isn't the acquisition of stuff. It's learning to live on less than you make, so you can give money back and have money to invest. You can't win until you do this." - Dave Ramsey
By being modest in your spending, you can ensure you will have enough for retirement and can give back to the community as well.
13. "Investing should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas." - Paul Samuelson
If you think investing is gambling, you're doing it wrong. The work involved requires planning and patience. However, the gains you see over time are indeed exciting! (For more reasons to be patient, check out Patience Is A Trader's Virtue.)
14. "I would not pre-pay. I would invest instead and let the investments cover it." - Dave Ramsey
A perfect answer to the question: "Should I pay off my _____(fill in the blank) or invest for retirement?" That said, a credit card balance ringing up 30% can turn into a black hole if not paid off quickly. Basically, pay off debt at high interest rates and keep debt at low ones.
15. "The four most dangerous words in investing are: 'this time it's different.'" - Sir John Templeton
Follow market trends and history. Don't speculate that this particular time will be any different. For example, a major key to investing in a particular stock or bond fund is its performance over five years. Nothing shorter.
16. "Wide diversification is only required when investors do not understand what they are doing." - Warren Buffett
In the beginning, diversification is relevant. Once you've gotten your feet wet and have confidence in your investments, you can adjust your portfolio accordingly and make bigger bets. (For more reason to reduce your diversification, read The Dangers Of Over-Diversifying Your Portfolio.)
17. "You get recessions, you have stock market declines. If you don't understand that's going to happen, then you're not ready, you won't do well in the markets." - Peter Lynch
When hit with recessions or declines, you must stay the course. Economies are cyclical, and the markets have shown that they will recover. Make sure you are a part of those recoveries!
The Bottom Line
The world of investing can be cold and hard. But if you do thorough research and keep your head on straight, your chances of long-term success are good. Refer back to these quotes when you're feeling shaky or are confused about investing. How are they relevant to your experience? Do you have any favorite quotes to add? (To learn more from great investors, read Greatest Investors.)
Labels: Investment Quote, Warren Buffett
26 August 2013
Warren Buffett Quotes
Rule No.1: Never lose money. Rule No.2: Never forget rule No.1.
It's better to hang out with people better than you. Pick out associates whose behavior is better than yours and you'll drift in that direction.
The rich are always going to say that, you know, just give us more money and we'll go out and spend more and then it will all trickle down to the rest of you. But that has not worked the last 10 years, and I hope the American public is catching on.
Price is what you pay. Value is what you get.
I always knew I was going to be rich. I don't think I ever doubted it for a minute.
Chains of habit are too light to be felt until they are too heavy to be broken.
Wall Street is the only place that people ride to in a Rolls Royce to get advice from those who take the subway.
You do things when the opportunities come along. I've had periods in my life when I've had a bundle of ideas come along, and I've had long dry spells. If I get an idea next week, I'll do something. If not, I won't do a damn thing.
I buy expensive suits. They just look cheap on me.
Risk comes from not knowing what you're doing.
Only when the tide goes out do you discover who's been swimming naked.
The first rule is not to lose. The second rule is not to forget the first rule.
I don't look to jump over 7-foot bars: I look around for 1-foot bars that I can step over.
If anything, taxes for the lower and middle class and maybe even the upper middle class should even probably be cut further. But I think that people at the high end - people like myself - should be paying a lot more in taxes. We have it better than we've ever had it.
In the business world, the rearview mirror is always clearer than the windshield.
Of the billionaires I have known, money just brings out the basic traits in them. If they were jerks before they had money, they are simply jerks with a billion dollars.
You only have to do a very few things right in your life so long as you don't do too many things wrong.
When you combine ignorance and leverage, you get some pretty interesting results.
Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks.
Derivatives are financial weapons of mass destruction.
If past history was all there was to the game, the richest people would be librarians.
I never attempt to make money on the stock market. I buy on the assumption that they could close the market the next day and not reopen it for five years.
The smarter the journalists are, the better off society is. For to a degree, people read the press to inform themselves - and the better the teacher, the better the student body.
There seems to be some perverse human characteristic that likes to make easy things difficult.
We always live in an uncertain world. What is certain is that the United States will go forward over time.
It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price.
Our favorite holding period is forever.
Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it.
We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.
Beware of geeks bearing formulas.
The business schools reward difficult complex behavior more than simple behavior, but simple behavior is more effective.
Only buy something that you'd be perfectly happy to hold if the market shut down for 10 years.
The investor of today does not profit from yesterday's growth.
There are 309 million people out there that are trying to improve their lot in life. And we've got a system that allows them to do it.
Your premium brand had better be delivering something special, or it's not going to get the business.
We enjoy the process far more than the proceeds.
I am a huge bull on this country. We will not have a double-dip recession at all. I see our businesses coming back almost across the board.
Risk is a part of God's game, alike for men and nations.
Time is the friend of the wonderful company, the enemy of the mediocre.
If a business does well, the stock eventually follows.
Wide diversification is only required when investors do not understand what they are doing.
Why not invest your assets in the companies you really like? As Mae West said, 'Too much of a good thing can be wonderful'.
We're still in a recession. We're not gonna be out of it for a while, but we will get out.
Economic medicine that was previously meted out by the cupful has recently been dispensed by the barrel. These once unthinkable dosages will almost certainly bring on unwelcome after-effects. Their precise nature is anyone's guess, though one likely consequence is an onslaught of inflation.
Let blockheads read what blockheads wrote.
In the 20th century, the United States endured two world wars and other traumatic and expensive military conflicts; the Depression; a dozen or so recessions and financial panics; oil shocks; a flu epidemic; and the resignation of a disgraced president. Yet the Dow rose from 66 to 11,497 (i.e. compounded at 5.3% per annum excluding dividend of 2 to 3% per annum).
I think the most important factor in getting out of the recession actually is just the regenerative capacity of - of American capitalism.
It's never paid to bet against America. We come through things, but its not always a smooth ride.
The only time to buy these is on a day with no 'y' in it.
I just think that - when a country needs more income and we do, we're only taking in 15 percent of GDP, I mean, that - that - when a country needs more income, they should get it from the people that have it.
When a management with a reputation for brilliance tackles a business with a reputation for bad economics, it is the reputation of the business that remains intact.
Americans are in a cycle of fear which leads to people not wanting to spend and not wanting to make investments, and that leads to more fear. We'll break out of it. It takes time.
We believe that according the name 'investors' to institutions that trade actively is like calling someone who repeatedly engages in one-night stands a 'romantic.'
Today people who hold cash equivalents feel comfortable. They shouldn't. They have opted for a terrible long-term asset, one that pays virtually nothing and is certain to depreciate in value.
You know, people talk about this being an uncertain time. You know, all time is uncertain. I mean, it was uncertain back in - in 2007, we just didn't know it was uncertain. It was - uncertain on September 10th, 2001. It was uncertain on October 18th, 1987, you just didn't know it.
I am quite serious when I say that I do not believe there are, on the whole earth besides, so many intensified bores as in these United States. No man can form an adequate idea of the real meaning of the word, without coming here.
We've used up a lot of bullets. And we talk about stimulus. But the truth is, we're running a federal deficit that's 9 percent of GDP. That is stimulative as all get out. It's more stimulative than any policy we've followed since World War II.
Read more at http://www.brainyquote.com/quotes/authors/w/warren_buffett_3.html#WYlU5c2zPfs6KDKi.99
Labels: Investment Quote, Warren Buffett
15 June 2013
顶级理财大师的投资理念
最新一期《福布斯》杂志推出2013投资特刊，网罗二十位投资达人，揭示从沃伦·巴菲特的父亲式忠告到新生代投资领袖拉米特·塞西的自动储蓄理论等诸多投资观点，为大众投资者展示了顶级理财大师的投资秘笈。
著名经济学家、财经评论家本·斯坦传承于家族的投资策略是稳健谨慎，自1983年开始买入伯克夏·哈撒韦股票的斯坦至今仍坚持持有，而无论投资 地产抑或股票，其始终如一的理念都来自先父的忠告：“绝不与穷邻为伍”。如今拥有十余处优质地产的本·斯坦建议投资股票应越早越好，并从交易所交易基金 (ETFs)开始买起。
对冲基金巨头、欧米加顾问公司掌门人里昂·库珀曼的投资心经则是“与大众背道而驰”，库珀曼一向擅长在价值被严重低估的股票池里淘金，其旗下对 冲基金自1991年成立以来，已创下年均收益率13%的佳绩。而年少时毅然弃医从经的库珀曼感触最深的投资要籍便是：“拥有对投资事业的极大热情”。
新生代理财专家、30岁的拉米特·塞西的投资建议是“莫把钱财耗费在无用处”，他认为年轻投资者应尽量杜绝像买杯咖啡这样可有可无的消费行为，并将自动储蓄行为制度化。
先锋投资集团创始人杰克·伯格则将高额成本视为投资大敌，他于1975年首创指数共同基金，成功之道便是低成本、长期投资。他建议美国的年轻人应尽早从常规储蓄和退休基金开始积累财富，并将主要资金用于投资低成本指数基金VOO, SPY, DIA, QQQ, ES3.SI or G3B.SI (STI ETF)，从而得到令人称奇的复利回报而非复合成本。
著名价值投资理论家、美国哥伦比亚大学商学院教授布鲁斯·格林沃德则始终信奉“无债一身轻”。号称“华尔街专家中的专家”的格林沃德认为，很多投资者很难把控收支平衡，从而阻碍了致富之路，而集中持仓量和赚别人的钱是他奉为上策的两点秘笈。
世界创富神话的传奇人物沃伦·巴菲特谈起自己的投资要诀，却很是平易：“莫让市场波动扰乱你的投资行为。”他有如父亲般地忠告投资者要始终控制好自己的情绪，并保持足够的耐心。
阿波罗全球资产管理公司创始人、私募股权巨头利昂·布莱克的投资忠告则是：“知所为、勿暴富、做功课、不大赌。”毕业于哈佛商学院的布莱克早年 入行投资圈时，在德崇证券师从垃圾债券先驱迈克尔·米尔肯，从中受益良多。他建议年轻从业者最好选择市场实际操作较多且良将齐聚的公司入行，以便迅速了解 投资行业的风险与回报，并学会如何耐住心性和抓住机会。
而巴伦资本创始人罗恩·巴伦则视长线投资为致富法宝。入行之初，初出茅庐不谙投资的巴伦一直忙于公司的短线交易，关键时刻得到一位投资前辈的提 醒：“你见过做短线的有买游艇的吗？”从此，远离短线交易便成为巴伦的投资底线。“短线如捷径，而投资路上没有捷径，你只有花费千百倍苦心才能达致成 功。”(石璐)
Labels: Investment Quote, Reference, Stock Trading System, Warren Buffett
20 March 2013
Awaiting long-term investment opportunities in stock index funds and luxurious condominium, which can only appear during financial crises or economic recessions.
Labels: Dollar Cost Averaging, ETF, PE Ratio, plan, STI ETF, Thoughts, Warren Buffett
26 December 2011
巴菲特2012年五大预言
未来也将会有各种坏消息，但是好公司，天长日久，将会为你创造巨大的财富
新快报讯 据《第一财经日报》报道，2011年11月14日，巴菲特接受CNBC电视台专访，做出对2012年的四大预言。
第一、世界还会很不确定，但我还会坚定持股优秀公司。
CNBC:“你是如何处理不确定性的？你是忽略所有的不确定性，还是说，你会想法处理这些不确定性并做出投资决策？”
巴菲特：“世界总是不确定的。即使美联储主席伯南克来见我，在我耳边小声告诉我们他明天将会做这件事那件事，我也根本不会改变我对自己想要买入股票的公司的看法。将来肯定会出现各种各样的大事件，肯定会有各种各样的不确定性，最终真正重要的是你持有的公司、农场、房子未来这些年份表现如何。我无法确定买入和卖出的具体时间。”
第二、股市还将会大幅波动，我会利用股市过度反应低价买入好公司。
CNBC:“你认为这种不确定性已经结束，或者说，我们现在非常担忧的头条新闻报道的欧洲出现重大风险使我们进入一个有所不同的新的时期？”
巴菲特：“除非我正在使用财务杠杆，否则我根本不会担忧头条新闻报道的风险。如果我私人拥有一家企业，比如我拥有镇上最好的一家餐馆，我会担忧明天的新闻头条说什么吗？”
“持有一家大公司的股份也是同样的道理。我根本不知道将来股市会上涨还是会下跌，其他人也根本不知道。忘掉股市吧。我根本不知道明天农场的市场价格会涨还是会跌，但我确实知道，如果是一家好农场，一个诚实勤劳的农夫租种这家农场，未来的收成肯定会有所提高。你只要拥有诚实能干的人管理的好的资产就行了。但是不要支付过高的买入价格，价格的波动性对你来说反而是好事。”
第三、未来还会有各种坏消息，但我会继续买入优质银行股。
CNBC:“将来某个时间点上，你是否可能进一步加大对银行股的投资？就像你前不久投资美国银行一样。”
巴菲特：“是的。第三季度、第二季度、第一季度，我都在不断买入富国银行。20年前我也买入了富国银行。未来也将会有各种各样的坏消息，但是好公司，天长日久，将会为你创造巨大的财富。”
第四、股市大跌，有些优质大盘股已经出现买入良机。
CNBC:“IBM也是一只道琼斯指数成份股，你已经大量买入了几只道琼斯指数成份股，这是不是你的投资风格发生变化的另一种表现？”
巴菲特：“是的，但这也意味着，与其他投资选择相比，一些规模非常大、实力非常强的美国公司的股价看起来非常便宜。我想说，最终你的目标是口袋里装满赚来的钱。你把现金装在口袋或者投到货币市场里，你一分钱也赚不到。如果你买入的美国公司净资产收益率很高，投入资本收益率很高，正在快速回购公司的股份从而会使现有股东的持股比例明显增加，那么你就会赚到很多很多钱。我喜欢所有这些特点。现在你可以将一个公司和另一个公司进行比较，但最终，你必须做出行动。什么也不做也是一种行动。”
第五、欧洲债务危机不同于美国金融危机，要解决还需较长时间。
CNBC：对于欧债危机有什么看法？
巴菲特：“欧洲会发现他们有一个最大的基础性缺陷，那就是他们不能印刷货币。当人们丧失信心时，就会形成一种挤兑风潮。2008年美国出现了债务危机，运用美国所有的力量，采取一些力度极大的措施才解决。”
“由于人们更加担忧，德国和其他国家甚至和法国的分歧越来越大，解决欧债危机需要更长的时间。人们根据情绪做出反应，但是在这种情况下情绪变成了现实。欧洲正在做出行动。欧洲具有所有各种力量，欧盟不会分裂。”
新快报讯 据《第一财经日报》报道，2011年11月14日，巴菲特接受CNBC电视台专访，做出对2012年的四大预言。
第一、世界还会很不确定，但我还会坚定持股优秀公司。
CNBC:“你是如何处理不确定性的？你是忽略所有的不确定性，还是说，你会想法处理这些不确定性并做出投资决策？”
巴菲特：“世界总是不确定的。即使美联储主席伯南克来见我，在我耳边小声告诉我们他明天将会做这件事那件事，我也根本不会改变我对自己想要买入股票的公司的看法。将来肯定会出现各种各样的大事件，肯定会有各种各样的不确定性，最终真正重要的是你持有的公司、农场、房子未来这些年份表现如何。我无法确定买入和卖出的具体时间。”
第二、股市还将会大幅波动，我会利用股市过度反应低价买入好公司。
CNBC:“你认为这种不确定性已经结束，或者说，我们现在非常担忧的头条新闻报道的欧洲出现重大风险使我们进入一个有所不同的新的时期？”
巴菲特：“除非我正在使用财务杠杆，否则我根本不会担忧头条新闻报道的风险。如果我私人拥有一家企业，比如我拥有镇上最好的一家餐馆，我会担忧明天的新闻头条说什么吗？”
“持有一家大公司的股份也是同样的道理。我根本不知道将来股市会上涨还是会下跌，其他人也根本不知道。忘掉股市吧。我根本不知道明天农场的市场价格会涨还是会跌，但我确实知道，如果是一家好农场，一个诚实勤劳的农夫租种这家农场，未来的收成肯定会有所提高。你只要拥有诚实能干的人管理的好的资产就行了。但是不要支付过高的买入价格，价格的波动性对你来说反而是好事。”
第三、未来还会有各种坏消息，但我会继续买入优质银行股。
CNBC:“将来某个时间点上，你是否可能进一步加大对银行股的投资？就像你前不久投资美国银行一样。”
巴菲特：“是的。第三季度、第二季度、第一季度，我都在不断买入富国银行。20年前我也买入了富国银行。未来也将会有各种各样的坏消息，但是好公司，天长日久，将会为你创造巨大的财富。”
第四、股市大跌，有些优质大盘股已经出现买入良机。
CNBC:“IBM也是一只道琼斯指数成份股，你已经大量买入了几只道琼斯指数成份股，这是不是你的投资风格发生变化的另一种表现？”
巴菲特：“是的，但这也意味着，与其他投资选择相比，一些规模非常大、实力非常强的美国公司的股价看起来非常便宜。我想说，最终你的目标是口袋里装满赚来的钱。你把现金装在口袋或者投到货币市场里，你一分钱也赚不到。如果你买入的美国公司净资产收益率很高，投入资本收益率很高，正在快速回购公司的股份从而会使现有股东的持股比例明显增加，那么你就会赚到很多很多钱。我喜欢所有这些特点。现在你可以将一个公司和另一个公司进行比较，但最终，你必须做出行动。什么也不做也是一种行动。”
第五、欧洲债务危机不同于美国金融危机，要解决还需较长时间。
CNBC：对于欧债危机有什么看法？
巴菲特：“欧洲会发现他们有一个最大的基础性缺陷，那就是他们不能印刷货币。当人们丧失信心时，就会形成一种挤兑风潮。2008年美国出现了债务危机，运用美国所有的力量，采取一些力度极大的措施才解决。”
“由于人们更加担忧，德国和其他国家甚至和法国的分歧越来越大，解决欧债危机需要更长的时间。人们根据情绪做出反应，但是在这种情况下情绪变成了现实。欧洲正在做出行动。欧洲具有所有各种力量，欧盟不会分裂。”
Labels: Warren Buffett
25 October 2011
向巴菲特学习投资指数基金 (Warren Buffett on Investment of Stock Index ETF )
Source: http://school.stockstar.com/SS2009093030238310.shtml
“我会把所有的钱都投资到一个低成本的跟踪标准普尔500指数的指数基金(VOO, SPY)”- 巴菲特 (Warren Buffett)
问：指数基金是被动管理，为什么它的长期收益率可能好于主动管理的股票基金呢？
答：被称为“股神”的巴菲特从不荐股，也从不预测市场走势，但是许多投资者都知道巴菲特唯一推荐过的投资品种就是指数基金。在15年间巴菲特屡次推荐指数基金的评论中，如果仔细研究，不难看出投资大师在投资指数基金时的独特视野。
首先，指数基金适于长期投资。在2008年5月3日伯克希尔股东大会上，名为Tim Ferriss的投资者问：“假设你只有三十来岁，没有什么经济来源，只能靠一份全日制工作谋生，但是你已经有笔储蓄，足够维持一年半的生活开支，那么你攒的第一个100万将会如何投资?”巴菲特回答：“我会把所有的钱都投资到一个低成本的跟踪标准普尔500指数的指数基金，除非我是在大牛市期间购买，否则我有信心获得强于市场的收益……然后继续努力工作。”巴菲特看到提问者的年龄大约是30岁，所以给他投资指数的建议。投资如果从30岁算起，到60岁左右退休，大约是30年。美国标准普尔500指数在1979年到2009年30年间，年均增长率将近8%。
另外，巴菲特认为大牛市的顶部买指数基金，风险是非常大的。但如果目前市场处于底部或者中部，投资风险得到释放，那么在市场恢复过程中，指数基金的表现是足够好的。今年上半年A股反弹时期，指数基金的表现无疑印证了这一观点。
第二，低费率的指数基金值得投资。在2003年巴菲特致股东的信中写道：“那些收费非常低廉的指数基金在产品设计上是非常适合投资者的。”巴菲特认为，对于大多数想要投资股票的人来说，收费很低的指数基金是最理想的选择。一般主动式管理基金的管理费为1.5%，托管费为0.25%；而国内指数基金的管理费率介于0.5%~1.3%之间，托管费率则在0.1%~0.25%之间，其中ETF和指数LOF的费率水平更低。加上LOF的便捷交易模式，投资成本更低。
第三点，定投指数基金是更好的投资方法。在2007年5月7日CNBC电视采访巴菲特时，他表示，个人投资者的最佳选择就是买入一只低成本的指数基金，并在一段时间里持续定期买入。如果你坚持长期持续定期买入指数基金，你可能不会买在最低点，但你同样也不会买在最高点。从长期来看，指数基金的收益率并不会输给主动型基金。
从国内数据来看，定投指数基金也明显胜出。海富通中证100指数基金拟任基金经理牟永宁表示，从历史数据来看，长期投资指数基金，在指数震荡上升的前提下，许多指数基金的收益要高于主动型基金。原因很简单，指数基金不做择时，在建仓完毕后一般执行的是“买入并持有”的投资策略，换手率远低于主动管理型基金。粗略统计，主动管理型基金每年的交易费率、佣金等运营成本比指数基金高2%。“尽管看起来2%微乎其微，但如果长期投资的话，累积起来的收益也相当可观。”
“我会把所有的钱都投资到一个低成本的跟踪标准普尔500指数的指数基金(VOO, SPY)”- 巴菲特 (Warren Buffett)
问：指数基金是被动管理，为什么它的长期收益率可能好于主动管理的股票基金呢？
答：被称为“股神”的巴菲特从不荐股，也从不预测市场走势，但是许多投资者都知道巴菲特唯一推荐过的投资品种就是指数基金。在15年间巴菲特屡次推荐指数基金的评论中，如果仔细研究，不难看出投资大师在投资指数基金时的独特视野。
首先，指数基金适于长期投资。在2008年5月3日伯克希尔股东大会上，名为Tim Ferriss的投资者问：“假设你只有三十来岁，没有什么经济来源，只能靠一份全日制工作谋生，但是你已经有笔储蓄，足够维持一年半的生活开支，那么你攒的第一个100万将会如何投资?”巴菲特回答：“我会把所有的钱都投资到一个低成本的跟踪标准普尔500指数的指数基金，除非我是在大牛市期间购买，否则我有信心获得强于市场的收益……然后继续努力工作。”巴菲特看到提问者的年龄大约是30岁，所以给他投资指数的建议。投资如果从30岁算起，到60岁左右退休，大约是30年。美国标准普尔500指数在1979年到2009年30年间，年均增长率将近8%。
另外，巴菲特认为大牛市的顶部买指数基金，风险是非常大的。但如果目前市场处于底部或者中部，投资风险得到释放，那么在市场恢复过程中，指数基金的表现是足够好的。今年上半年A股反弹时期，指数基金的表现无疑印证了这一观点。
第二，低费率的指数基金值得投资。在2003年巴菲特致股东的信中写道：“那些收费非常低廉的指数基金在产品设计上是非常适合投资者的。”巴菲特认为，对于大多数想要投资股票的人来说，收费很低的指数基金是最理想的选择。一般主动式管理基金的管理费为1.5%，托管费为0.25%；而国内指数基金的管理费率介于0.5%~1.3%之间，托管费率则在0.1%~0.25%之间，其中ETF和指数LOF的费率水平更低。加上LOF的便捷交易模式，投资成本更低。
第三点，定投指数基金是更好的投资方法。在2007年5月7日CNBC电视采访巴菲特时，他表示，个人投资者的最佳选择就是买入一只低成本的指数基金，并在一段时间里持续定期买入。如果你坚持长期持续定期买入指数基金，你可能不会买在最低点，但你同样也不会买在最高点。从长期来看，指数基金的收益率并不会输给主动型基金。
从国内数据来看，定投指数基金也明显胜出。海富通中证100指数基金拟任基金经理牟永宁表示，从历史数据来看，长期投资指数基金，在指数震荡上升的前提下，许多指数基金的收益要高于主动型基金。原因很简单，指数基金不做择时，在建仓完毕后一般执行的是“买入并持有”的投资策略，换手率远低于主动管理型基金。粗略统计，主动管理型基金每年的交易费率、佣金等运营成本比指数基金高2%。“尽管看起来2%微乎其微，但如果长期投资的话，累积起来的收益也相当可观。”
Labels: Dollar Cost Averaging, ETF, STI ETF, Warren Buffett
19 July 2011
Four Reasons to Invest in STI ETF (ES3.SI or G3B.SI)
by Alvin on February 27, 2011
#1 Low cost – management fee and sales charge less than 1% per year
If you understand compound interest and its effect, you would know that your investment capital would exponentially. Likewise, if compound interest can work for you, it can work against you as well. I am talking about fund management fees. They have eroding effects too. It makes a lot of sense to spend as little as possible for fund fees. This is one important criteria when you invest in any funds. STI ETF currently charges about 0.3% management fee, comparing to similar unit trusts which charged between 0.75-1.5%. This means that you have 100-500% of savings right from the start! And this has not factored in the compounding effect. Talking about sales charges, Fundsupermart currently charges 1.25% for the unit trusts and while you buy STI ETF from a broker, POEMS charges 0.18% to 0.28%. If you just buy a lot which cost you $3,000 and the minimum brokerage fee is $25, your percentage cost would be 0.83%, still lower than the unit trust’s sales charge.
#2 Growing Singapore economy
As a Singaporean, I am happy in where I am as I see Asia as an emerging affluent continent. Singapore being a business hub, would likely to flourish with Asia. I have faith in the economy and hence, buying into Singapore companies is one of the best way to participate in the growth of Asia. We have many established companies that have began expanding their influence in Asia and other parts of the world. Giants like Singtel, KepCorp, SembCorp, DBS, UOB, etc, are well managed and financially sound (I am not suggesting these are stocks to buy, they are just example to illustrate my point). As Asia grows, I believe they would gain some market share as well. And right now, they have consistent cash flow as they provide services that Singaporeans pay for everyday. To be able to buy into all these companies would require a large capital. But with STI ETF, you would be able to partly own the top 30 companies in Singapore, the bluest chips of all.
#3 Good Diversification
The STI has a mathematical methodology to identify the top 30 companies in Singapore. There will be periodic review of the constituent stocks and any replacement of the top 30 can be effected. STI ETF would track this index closely, and make adjustments accordingly. As such, you would always buy into the top 30 companies at any one time. You do not rely on any single company for investment growth. And in this 30 companies, they cover many industries and sectors. These are forms of diversification. This is especially important if you do not know how to pick stock.
#4 Buy the index if you cannot beat it
It has been said that most fund managers cannot beat the benchmark index. Is it true? Kay from Moneytalk did a comparison between STI ETF and the similar unit trusts. Taking the dividends from STI ETF into consideration (without factoring the fund costs for all funds), the STI ETF indeed outperformed the fund managers. There is a saying, “if you can’t beat them, join them”! If the fund managers are unable to beat the index, it would be wise to buy something that replicates closely with it – STI ETF.
Conclusion
Comparing to unit trusts, you can buy STI ETF at a cheaper rate and have a potential higher return. To me, it isn’t a difficult choice. Another important thing I want to warn you is that you still have to buy at the right time. Do not expect to buy the STI ETF at the height of a bull market and expect to see profits. Timing is important. I would like to quote Warren Buffett, “be fearful when others are greedy and be greedy only when others are fearful”.
#1 Low cost – management fee and sales charge less than 1% per year
If you understand compound interest and its effect, you would know that your investment capital would exponentially. Likewise, if compound interest can work for you, it can work against you as well. I am talking about fund management fees. They have eroding effects too. It makes a lot of sense to spend as little as possible for fund fees. This is one important criteria when you invest in any funds. STI ETF currently charges about 0.3% management fee, comparing to similar unit trusts which charged between 0.75-1.5%. This means that you have 100-500% of savings right from the start! And this has not factored in the compounding effect. Talking about sales charges, Fundsupermart currently charges 1.25% for the unit trusts and while you buy STI ETF from a broker, POEMS charges 0.18% to 0.28%. If you just buy a lot which cost you $3,000 and the minimum brokerage fee is $25, your percentage cost would be 0.83%, still lower than the unit trust’s sales charge.
#2 Growing Singapore economy
As a Singaporean, I am happy in where I am as I see Asia as an emerging affluent continent. Singapore being a business hub, would likely to flourish with Asia. I have faith in the economy and hence, buying into Singapore companies is one of the best way to participate in the growth of Asia. We have many established companies that have began expanding their influence in Asia and other parts of the world. Giants like Singtel, KepCorp, SembCorp, DBS, UOB, etc, are well managed and financially sound (I am not suggesting these are stocks to buy, they are just example to illustrate my point). As Asia grows, I believe they would gain some market share as well. And right now, they have consistent cash flow as they provide services that Singaporeans pay for everyday. To be able to buy into all these companies would require a large capital. But with STI ETF, you would be able to partly own the top 30 companies in Singapore, the bluest chips of all.
#3 Good Diversification
The STI has a mathematical methodology to identify the top 30 companies in Singapore. There will be periodic review of the constituent stocks and any replacement of the top 30 can be effected. STI ETF would track this index closely, and make adjustments accordingly. As such, you would always buy into the top 30 companies at any one time. You do not rely on any single company for investment growth. And in this 30 companies, they cover many industries and sectors. These are forms of diversification. This is especially important if you do not know how to pick stock.
#4 Buy the index if you cannot beat it
It has been said that most fund managers cannot beat the benchmark index. Is it true? Kay from Moneytalk did a comparison between STI ETF and the similar unit trusts. Taking the dividends from STI ETF into consideration (without factoring the fund costs for all funds), the STI ETF indeed outperformed the fund managers. There is a saying, “if you can’t beat them, join them”! If the fund managers are unable to beat the index, it would be wise to buy something that replicates closely with it – STI ETF.
Conclusion
Comparing to unit trusts, you can buy STI ETF at a cheaper rate and have a potential higher return. To me, it isn’t a difficult choice. Another important thing I want to warn you is that you still have to buy at the right time. Do not expect to buy the STI ETF at the height of a bull market and expect to see profits. Timing is important. I would like to quote Warren Buffett, “be fearful when others are greedy and be greedy only when others are fearful”.
Labels: Dollar Cost Averaging, ETF, STI ETF, Warren Buffett
