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Equity Risk Premium
A widely known way to value a stock is its price to earnings ratio. It tells us what investors are willing to pay for each dollar of profit a business behind that stock earns. The…
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Perspectives
A wise woman once said that when in doubt, zoom out. So zoom out I did. This is what a 40-year chart of the Dow Jones Industrial Average looks like… Add in reinvested dividends and…
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Mind That Concentration Risk
Rule number one – don’t lose money. Rule number two – don’t forget rule number one. That of course is classic Buffett. So, say you have a choice between investing in the hottest tech stock around…
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A Pension Plan Of One
How long will you live? Average life expectancy these days for a typical American is about 80 years. And that life expectancy is somewhat distributed like this… It is skewed left because some unlucky few…
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Annuities – Directionally Right But Mostly Wrong
Annuities are insurance products. And insurance is an expense. It is never an investment. What do you get for that expense? Risk reduction (definition of insurance) but above all, peace of mind. You buy life…