Market Analysis

Basic Probability Theory

Probability Theory

The unfortunate reality is that nothing in this world is certain. In fact, the only thing in life that is certain ... is that nothing is certain. This is especially true when we talk about money and investing. Since we can't deal with certainties, we're forced to deal with probabilities. Therefore, probabilities become the lens through which we must view all things investment related.


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Posted in: Behavioral Finance Educational Psychology Risk

Corrections vs. Bear Markets

Bear

Anyone who's been around for longer than a couple of decades knows that stocks can lose a lot of value quickly. These periods, when stock prices are falling, can be classified into two types of declines: corrections, and bear markets. Understanding the difference between these is critical, because the former represent minor speed bumps on the way to higher prices, while the latter can wreck your entire portfolio and set you back years from reaching your retirement goals.


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Posted in: Asset Allocation Corrections Educational Primary Trend Stocks

Your Money is Your Second Business

Your Money is Your Second Business

Have you ever wanted to be a business owner? Well, congrats ... you already are. The minute you have even a few thousand dollars to your name, you're officially a professional money manager running your own investment firm. Of course, you probably don't see it that way, but that's because you haven't been enlightened yet. No one has ever spelled it out for you before. Well ... it's time to fix that.


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Posted in: Dividends Educational Expenses Motivation Psychology Retirement

How to Predict Future Stock Market Returns

How to Predict Future Stock Market Returns

Every year, top Wall Street analysts put their thinking caps on and try to forecast the upcoming year's market return. The result of their analysis usually comes in the form of "price targets" which indicate where major indexes such as the S&P 500 are likely to be at year end. While price targets have little value themselves, what is valuable to investors is having a framework in which to view future returns.


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Posted in: Asset Allocation Dividends Earnings Educational Psychology Stocks

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