When it comes to learning how to invest in the stock market, who better to take tips from than “one of the world’s most powerful investors….Warren Buffet.”
Over the years, the Berkshire Hathaway CEO has given his tips for stock market investors:
“The best thing with stocks, actually, is to buy them consistently over time. You want to spread the risk as far as the specific companies you’re in by owning a diversified group, and you diversify over time by buying this month, next month, the year after, the year after, the year after.”
He also said in the same year:
“If you save money, you can buy bonds, you can buy a farm, you can buy an apartment/house — or you can buy a part of an American business. And if you buy a 10-year bond now, you’re paying over 40 times earnings for something whose earnings can’t grow. You compare that to buying equities, good businesses, I don’t think there’s any comparison.”
CEO of Amazon, Jeff Bezos has in the past, told his employees:
“When the stock is up 30% in a month, don’t feel 30% smarter — because when the stock is down 30% in a month, it’s not going to feel so good to feel 30% dumber.”
Peter Lynch said:
“Behind every stock is a company. Find out what it’s doing.”
And Bill Ackman said:
“From day one, I was always unafraid to ask someone to invest because, I thought that, while capital was a commodity, good investment ideas were rare assets…Investing is one of the few things you can learn on your own.”
For those looking to get into the hedge fund industry, or wanting to make investments, it’s worthwhile contemplating these above ideas.
This video presents a brief overview on the world’s largest hedge fund manager – Ray Dalio who talks about how the dollar is losing its reserve currency status. Over the past 34 years Dalio has seen China do something unprecedented. A massive shift which has made it “the greatest economic miracle ever.” Charts show what China has done from 1978-2018 and how things look now in the global economy.
For the first time since the 2018 fiscal crisis, the hedge fund industry is contracting. According to BlackRock CEO Larry Fink, this has resulted in the occurrence of a “mini 2008-2009 . . . We saw a massive amount of deleveraging” from hedge funds.”
HFR President Kenneth Heinz said:
“Hedge fund outflows in Q4 were driven by several factors, most notably investor reaction to steep losses in traditional asset investments and the sharp spike in equity market volatility leading to redemptions.”
So what are attitudes to hedge fund establishments with this backdrop? According to founder and CEO of hedge fund recruiter IDW Group Ilana Weinstein:
“You have to be borderline crazy to be starting a hedge fund in this environment and the only way you should do it is if you feel you have something differentiated to offer,”
And (former) hedge fund manager Philippe Jabre asserted that:
“The last few years have become particularly difficult for active managers… Financial markets have significantly evolved over the past decade, driven by new technologies, and the market itself is becoming more difficult to anticipate as traditional participants are imperceptibly replaced by computerised models.”
Managing Director and Global Head of Hedge Funds at Cambridge Associates, LLC, Eric Costa said:
“2019 is an important year for hedge funds. Over the last eight to 10 years, capital markets were up and to the right, a suboptimal environment for hedge funds. [however] “rising volatility, lower correlations and higher dispersion mean that the year is setting up nicely for hedge funds,”
Co-CIO of Bridgewater Associates LP, Robert Prince, said:
“We’ve been in a great market for the past nine years that benefited long-oriented managers because many assets did very well in an environment of falling yields, quantitative easing and good growth…[the reversal of those conditions makes it much harder for long-biased managers but is] an opportunity to demonstrate skill for strategies that do not have a long bias.”
Which countries are best for conducting business in 2019? For the last 13 years, Forbes has been presenting its annual recommended list on the regions most amiable to capital investment. For the second consecutive year the UK is was ranked Number 1. According to Mark Zandi, Chief Economist of Moody:
“The U.K. has a globalized economy that is more open than most across the world in terms of trade, investments, capital flows and, until recently, immigration.”
However, Brexit is bringing its own set of complications. According to Michael Lennon, President of the Irish Hotels Federation (IHF):
“We are increasingly concerned about the direction that Brexit is taking and the impact that heightened uncertainty is having on our sector. A disruptive Brexit would have enormous economic repercussions which would be felt directly by tourism businesses given our heavy reliance on the UK market. [With all the uncertainty consumer sentiment will likely be negatively impacted]. The impact would be more pronounced in regions with greater exposure to the UK market, particularly those outside the main tourism hotspots. These regions have lagged behind in recent years and can least afford the economic hit.”
Meanwhile, the US was placed in the 17th position, primarily due to
“growing evidence of Russian interference in the 2016 presidential election, violations of basic ethical standards by the new administration, and a reduction in government transparency.”
Globally, the World Bank anticipates that the international economy will likely become more stagnant at a rate of 2.9 percent this year (compared with 3 percent last year) thanks to heightened trade tensions and worldwide trade.
The growth of the global economy is expected to slow to 2.9 percent in 2019 compared with 3 percent in 2018, the World Bank said on Tuesday, citing elevated trade tensions and international trade moderation. With the US-China trade dispute, it is anticipated that US growth will probably drop to 2.5 percent (from 2.9 last year) with China taking a .3 percent drop from 6.5 last year to 6.2 in 2019.
In this video, The Economist’s Capital Markets Editor John O’ Sullivan talks about where to invest in 2019. He begins by talking about the not so positive 2018 year of stock investments and how this trend really began in 2009 with the bullish market.
A hike of 50.7% was encountered in Night Owl Capital Management LLC’s SPDR S&P 500 ETF Trust for Q3 2018. This bolstered its company stock earnings to 1,468 shares following its 494 share acquisition. Its recent filing with the SEC showed its SPDR S&P 500 ETF Trust being valued at $427,000.
A decrease in stake in Visa was also made by the firm in the same quarter by 1.64% and Mastercard by 1.54%. With the 4.30% market decline, the company sold 3,603 shares.
According to Miller Tabak Equity Strategist Matt Maley, the company is now “roaring back” from its fiscal crisis of $6.66. He said:
“We were able to hold that 2009 low and that should … limit the downside at least over the near term. However, we’re going to have to see a lot more work and a lot more action in this stock before we can say the worst is behind it for sure [with the stock jumping to $7.72 per share]. The stock fell so far, so fast that any resistance level, for instance, its 50-day moving average and its trend line for 2018, they are much higher than where the stock is now, 25 to 35 percent higher. When you want a stock to really confirm that the worst is behind it, you want to see it break a few resistance levels.”
CEO of Chantico Global Gina Sanchez said:
“We’ve seen a pretty big Hail Mary in terms of their determination to restructure the firm and to restructure the outlook for where they’re going to put their focus but that’s something that takes years to build out. For the time being, it has to survive the negative headlines, and a liquidity crunch is not the kind of negative headline that you want to have, an SEC probe is not the kind of negative headline you want to have, so we’re not out of the woods.”
As we come to the end of 2018 and complete our fiscal statements for the year, it’s a good time to start looking at possible investment options for next year. And with a quick scour of the net, one can find a variety of individual experts giving their personal preferences as to the best way forward.
One example of this was Michael Shustek’s recent article. As the CEO of The Parking REIT, he has four areas he believes we should be focusing on. These are: Stocks (with an evaluation of fee structures in mutual funds), real estate (direct rental property ownership to private placements and REITs); cash(hold on to what you can) and yourself (keep adding skills and knowledge and become more of an asset to your company or employer).
Another example is suggestions given by Charles Lewis Sizemore. These He promotes: emerging markets since
“the short-term outlook for emerging markets is cloudy, particularly with Chinese growth slowing. And you should never put a large chunk of your portfolio in something as volatile as emerging market stocks. But given the outlook on the sector, it might make sense to have at least a modest piece of your portfolio invested in emerging-market stocks,mutual funds or exchange-traded funds.”
He also suggests investing more in value stocks based on findings from the Dimensional Fund Advisors (DFA). Between 1926 and 2016 the DFA saw that large-cap growth stocks returned about 9.6% per year, (only a fraction higher than the S&P 500’s 10.3%). But large-cap value stocks returned 12.5%; such seemingly miniscule amounts actually add up to significant gains over time.
Sizemore also believes in alternative investments – which actually covers a broad spectrum from commodities, to cryptocurrencies and more and by focusing on this strategy one is provided with the opportunity to use their existing assets differently – “alternatively” if you like.
And again, like Shustek, Sizemore believes in oneself as an investment as there is nothing quite like “rolling up
sleeves and getting to work” to help you in your long term financial success.
Can trade fears ease with China? Is it likely and would it be a boost to international markets? In this short CNBC video, David Owen of Jeffries International takes a look.
In 2013, a group of accomplished finance-industry executives joined together to create STS Capital Partners. An M&A advisor, today the investment banking firm also counsels clients on divestitures and project financing, within a wide range of industries including: construction, manufacturing and distribution, pharmaceuticals, real estate and tourism.
But it’s not just business with the firm. Founder Rob Follows, makes time for charitable endeavors as well. One example that stands out is his climbing of mount Everest to raise funds for Altruvest Charitable Summits. In addition, Managing Director at the firm Gayle Pearce established Abundant World Foundation – a charitable entity which “partners with visionaries who transform scarcity into abundance.” Today, STS also takes a principal role in the support of the work undertaken there.