Investment Vs. Speculation
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Investment Vs. Speculation

“An investment operation is one which, upon thorough analysis, promises safety of principal and an adequate return. Operations not meeting these requirements are speculative.” — Ben Graham It occurs to me that the typical individual who buys and sells common stocks makes little or no distinction between the concepts of speculation versus investment. Instead they […]

Framing Effect
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Framing Effect

Framing effect, in general, is the tendency of the people’s decisions to get affected by the way in which the choices are framed. The minds of individuals react differently to the information based on the way it is presented. The perception changes as a function of some variation in framing. The framing effect has significant impact on […]

Case Study
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Everything is a Case Study

Everything is a Case Study Think about what type of case it is and what principles apply to that type of case. By doing this and helping others to do this you’ll get better at handling situations as they repeat over and over through time.   Please follow and like us:0

BEST INVESTORS
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QUALITIES COMMON TO THE BEST INVESTORS

The world’s best investors are special in many ways and it’s difficult to count all of their skills and abilities. They are also not all the same and each one of these individuals has his own peculiarities. However, there are a few traits common to all of these finance experts and we will explain them […]

Success
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The Science of Success Lessons from Charles G. Koch

The Science of Success Lessons from Charles G. Koch “The man who grasps principles can successfully select his own methods. The man who tries methods, ignoring principles, is sure to have trouble. —RALPH WALDO EMERSON”  “My lessons weren’t specific to business, but they were fundamental values—integrity, humility, responsibility, work ethic, entrepreneurship, a thirst for knowledge, […]

Graham Number
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Graham Number (grahamnumber)

Graham Number is calculated as follows: Graham Number = Square Root of (22.5 * Book Value * Earnings per share) = Square Root of (22.5 * Net Income * Shareholder’s Equity) / Shares Outstanding- He wrote in “The Intelligent Investor” (1948 version) regarding to the criteria for purchases:-  “Current price should not be more than […]

Market Model
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Cheung’s Market Mood Model

There are six phases of market mood in Cheung’s model: Normal— This is the base-building or consolidation phase where fundamentals are poor but stabilizing. Value investors are showing interest. Hypomania— Favorable news shocks hit the market, and prices break higher out of consolidation. Speculators, focused on short-term gains, begin buying. As the market continues higher, […]

Warren Buffett has said, value and growth “are joined at the hip.”
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Warren Buffett has said, value and growth “are joined at the hip.”

Warren Buffett has said, value and growth “are joined at the hip.” See growth is always a component in the calculation of the intrinsic value of a stock. Sometimes growth is enormously important to the calculation of value. Sometimes it’s not important at all. Sometimes growth positively impacts value. Sometimes growth can negatively impact value. […]

valueandprices
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Gambling and Investing

Investing is an action that defers consumption in the present in the hope that you will be able to consume more in the future. An investor has an expectation of a positive real rate of return, even though it is possible that this will not happen (especially in the short run). In other words, an […]