Protective Put Options as “Insurance”
The markets are expensive at the moment and it might be time for investors to refresh themselves on the risk management benefits of options. Put options can be used as “insurance” to hedge a position in what is commonly known as a Protective Put option strategy. With a Protective Put option strategy, the investor stays […]
A Guide to Investing for Beginners— Your Path to Financial Freedom
“Investing is the process of laying out money now to receive more money in the future.” Warren Buffett Most people think they need thousands or millions of dollars to start investing. The good news is you don’t. We will discuss how to start investing if you are new to the whole idea. There are some […]
How To Best Reduce Investment Risk – A Comprehensive Framework
Updated 4/21/2023 After much effort, you have finally mastered value investing. You now know how to identify good companies and value them. You also only invest in those that trade at a significant discount to the intrinsic value. But success in investing comes from a combination of skill and luck. To protect yourself against bad […]
10 Reasons Why Compounding Interest is the 8th Wonder of the World
The words compounding interest are two of the most powerful in the investing world. Today, I’m going to show you 10 reasons why. Albert Einstein called compounding interest: “the most powerful force in the universe.” Albert Einstein Billionaire Warren Buffett confessed, “My wealth has come from a combination of living in America, some lucky genes, […]
How Can I Calculate Average Cost for My Investments?
Updated 2/19/2024 If you’re familiar with the Investing for Beginners community, you know that we are all HUGE fans of contributing to your retirement accounts consistently. The biggest key to this is that you can average out your investments to reduce volatility, but how do you know you’re doing this? Well, you must know how […]
Basic Overview of the G-SIBs Industry (U.S. Market)
G-SIBs, or Globally Systemically Important Banks, comprise some of the biggest banks in the world and face additional regulations than smaller banks. They are called globally systemically important because of the failure of any one of them could cause a great financial collapse—something the world faced the possibility of in 2008-2009. This last “Great Financial […]
Letter to My Future Self – Investing in the Next Bear Market (‘20 Lessons)
Dear Forgetful Andrew, It’s really hard to remember the details when too much time passes. So I’m writing to you now so that hopefully you don’t forget what’s most important when the next bear market comes around. We just exited through one of the fastest bear markets and recoveries that the stock market has ever […]
IFB194: Thoughts on Heavy Portfolio Concentration
Welcome to the Investing for Beginners podcast. In today’s show we discuss: Thoughts on Palantir and heavy portfolio concentrations How dollar-cost averaging can help you when prices rise What to do as you approach the 15 to 20 stocks in your portfolio, where to look for other ideas, or reinvesting in your portfolio. For more […]
Concentrated Portfolio: The 4 Hidden Risks for the Average Investor
Having a concentrated portfolio of stocks has been the secret to success for many great investors such as Warren Buffett. Though Buffett is one of my heroes, I’ve come to the conclusion that a concentrated portfolio is probably not the right solution for the average investor, and certainly not for most. Trust me, I know […]
ROIC Analysis: Value Destruction From Growth and Other Pitfalls
Something that might shock the average investor is that growth can actually lead to value destruction for a company, depending on how a company is achieving that growth. Using ROIC analysis and comparing it to a company’s cost of capital, we can quickly determine when that is happening and steer clear from these types of […]
