The Education of a Value Investor Book Review

The Education of a Value Investor_

Are you ready to be educated?

The Education of a Value Investor by Guy Spier details his “Transformative quest for wealth, wisdom and enlightenment.”

So should you really expect to get schooled by this new value investing book?

Well, keep reading this book review to find out. In the paragraphs that follow you’ll learn what I liked most about Guy Spier‘s new book, what you can expect to get out of the book, and why it’s a one-of-a-kind value investing book.

Now let’s get down to the business of reviewing The Education of a Value Investor.

What’s “The Education of a Value” Investor All About?

The Education of a Value Investor is about Guy Spier’s quest to become a better value investor, and a better person. The book proceeds in a chronological and autobiographical fashion. So you very quickly get a feel for who Guy Spier is, where he came from, and what he aspires to be.

That makes it all the more interesting to follow, as Guy recounts the bumps he encountered on the way to his dreams. Nothing’s ever as easy as it seems, right? And Guy is refreshingly honest about how his initial ambitions and actions didn’t take him where he wanted to go.

But this book isn’t just the life story of a successful value investor.

While The Education of a Value Investor is relatively introspective, it’s also packed with highly-valuable information that will be of interest to any do-it-yourself stock picker or aspiring fund manager. As much as the book is autobiographical, it’s also instructive.

Let me show you what I mean.

My Favorite Parts of The Education of a Value Investor:

The Education of a Value Investor is an all around great book. But some of my favourite parts of reading it were the actionable lessons for value investors everywhere. And although the whole book carries an instructive and educational tone, there are a few chapters in particular that are especially illuminating.

For example:

One chapter of The Education of a Value Investor talks about “Investing Tools” and dictates 8 of Guy’s investing rules that he follows in his own portfolio. It’s neat to get an inside look at how a leading value investor thinks about the challenges that come with managing your own money.

In another chapter, the author shares the importance of an investment checklist. Not only does he explain some of the items on his checklist. But he walks through specific investing case studies and highlights past mistakes that caused him to put these qualifying criteria on his checklist. This chapter alone is worth the price of admission.

I also enjoyed learning more about the friendship between Mohnish Pabrai and Guy Spiers. Long time readers will recall Pabrai is the author of one of my favourite value investing books, The Dhandho Investor. I hadn’t realized how close these two value investors were. I was also pleased to learn Guy is friends with John Mihaljevic who wrote another one of the best value investing books around, The Manual of Ideas.

Obviously, you can learn a lot from this book. But before you rush out and buy The Education of a Value Investor, there’s one thing you should know.

What The Education of a Value Investor Is Not:

While it should be clear that I enjoyed this book, I don’t want you to buy it for the wrong reason. So let me just say…

If you’re looking for a methodological book about how to analyze aspects of value investments, like financial statements or industry fundamentals this probably isn’t the book for you. In fact, you’ll probably appreciate The Education of a Value Investor even more, if you go ahead and read The Intelligent Investor (or Security Analysis) first.

But if you already have this basic foundation in value investing, then you’re sure to appreciate this story about one value investors journey. It’s inspiring, interesting and incredibly informative in ways I didn’t expect possible.

In fact, I’d argue that this book is in the minority of investing books specifically because it does not overly focus on the technical aspects of capital allocation. Instead, you meet a man and watch how he’s dealt with the challenges of life. It’s fascinating. And inspiring.

The Education of a Value Investor – The Final Word:

The Education of a Value Investor was a very enjoyable book. It was only about 190 pages. And I read it in a couple of days because I simply couldn’t put it down. Plus, the book just came out a few weeks ago. So you know it’s relevant to contemporary value investors. For these reasons, I recommend you buy The Education of a Value Investor for yourself on Amazon.

If you’re still not convinced, I encourage you to check out the video book review below.

The Education of a Value Investor Video Book Review:

Best New Stock Trading Blog?

best new stock trading blog

Where in the world is the best new stock trading blog?

Are you looking for the next best stock trading blog?  Well, you’re not the only one. But lucky for you, I may have found one of the best new stock trading blogs online.

So keep reading, because…

I’m about to show you a new stock trading website like no other. Plus I’ll tell you what makes this market commentary stand head-and-shoulders above the rest. Sound good?

Now I know you’re probably dying to find out, so…

What’s the Best New Stock Trading Blog?

Well, if you put a gun to my head and asked me, “Jeff, what’s the best new stock trading blog?” I would have to say the answer is

If you’ve been active around Stocktwits, and the financial blogosphere you probably know the name ChessNWine. His twitter account has amassed a massive following. And for good reason.

Let me tell you why…

Why is This Stock Trading Blog So Great? is a brand-new website. It only just launched in earnest, earlier this week! So let me explain why you’ll probably want to bookmark it:

First of all, ChessNwine share real-time market commentary every single day, multiple times a day. So you can always get an up to date look at what’s going on in the market.

To make matters better, all of this content is presented in a very easy to understand manner. The focus is really on helping you understand different trading strategies, time-tested market principles and vigorous discipline… not to mention emotional mastery.

Finally, ChessNWine is one of the most dedicated financial writers I’ve seen in all my years of abundant information consumption. He consistently creates fantastic content that traders around the world look forward to. For example, his daily market recap videos provide an objective and consistent stock market analysis that simply doesn’t exist anywhere else.

So all that to say…

I encourage you to check out for yourself. And let me know in the comment section below, is this the best new stock trading blog or what?

PS – I apologize for the hiatus. Lots going on here. But I’ll re-prioritize these writings.

Undervalued looking up

Under-Valued Upward Revisions

Stock picking isn’t easy. And since the market is always changing, you need to always be on the lookout for new ideas. But more importantly…

You need to be on the lookout for new ways to lookout for new ideas! That’s why I love free online investing tools like these FinViz stock screens. Stock screeners let you splice and dice data in all kinds of peculiar permutations.

So let me show you how I found these under-valued stock ideas that are starting to shine.

Screening for Under-Valued Upward Revisions:

A lot of my stock screens revolve around trying to find under-valued companies. But lately, my usual stock screens aren’t producing much in the way of success. So I’m trying to spice things up and be a bit more proactive about finding stocks that are moving up.

But how do you know which stocks will keep moving up?

One of the most reliable indicators, according to the book How to Make Money in Stocks, is increasing EPS. The book makes a compelling case for why ongoing increasing EPS is the main driver for higher stock prices.

So in this screen, I tried to isolate under-valued and fundamentally sound ideas. Then I looked for companies that have recently announced an upward revision to their EPS guidance. The idea here is not only will these businesses will continue to generate strong earnings but they’re also under-valued relative to their earnings growth. So what are these stocks?

Take a look at the screenshot below from the PPT stock screener:

Under-Valued Upward Revisions

Under-Valued Upward Revisions

As you can see, the list of stocks isn’t huge. But it’s a good jumping off point for further research. GME in particular jumps out at me as one that might be interesting. By the way…

Just for your context, the fundamental score in the above stock screen filters out companies that are expensive based on price to sales, price to cash-flow, price to book and a number of other fundamental metrics. The fair price target is calculated using Eddy Elfenbein’s simple valuation measure.

As you can see, this is a quick and dirty approach, but it helps speed up the stock picking research process and could lead to new

And feel free to let me know in

The Alchemy of Finance Book Review

The Alchemy of Finance Book Review

Read This Alchemy of Finance Book Review…

The Alchemy of Finance, by George Soros, is an in-depth look at financial and human behavior.

I have been meaning to read The Alchemy of Finance for a while now. And now that I’ve finally gotten around to it I hope this book review will help you decide if The Alchemy of Finance is right for you. So what’s this book all about anyway?

Well, keep reading! In this book review I’ll show you what The Alchemy of Finance is all about. You’ll also discover the major sections of the book and what they cover. Plus you’ll see the one part of this book that I could have done without. By the time you’re done reading you will be able to make an educated and informed decision about The Alchemy of Finance. Now let’s get down to business…

What The Alchemy of Finance is All About:

The main idea George Soros discusses in The Alchemy of Finance is his concept of “reflexivity.” Since The Alchemy of Finance was written in the late 1980′s, when efficient market theory was at it’s prime, these ideas of reflexivity flew in the face of conventional wisdom. But what’s reflexivity all about anyways?

Good question. So as a reminder, recall that efficient market theory dictates the market is all-knowing, and made out of logical and rational participants all acting in their best interest. But this dictum flew in the face of George Soros’ personal experience.

Soros discovered that the markets are a dynamic experiment that is always changing. They cannot be reduced to rational and linear models that don’t reflect their true complexity. He explains how not only do the fundamentals of a given stock determine it’s price. But also that the price action of the stock influences the fundamentals (by influencing lenders’ perception of credit-worthiness, for example).

This is a pretty wild idea. And it sounds like it caused some splashes when it was originally published back in the late 1980′s. But after Soros introduces his theory of reflexivity, he goes on to discuss it as it applies to financial markets. He look for reflexivity in the global trading of stocks, debt and currencies. And he does a good job sharing the implications of his though-experiments.

One Really Good Part of The Alchemy of Finance:

One part of The Alchemy of Finance that exceeded my expectations was Soros’ “real time experiment.” To help the reader understand and accept his theory of reflexivity, Soros keeps a personal diary for about 18 months. During this time, he explains his trading ideas and activities. You get to see in real-time how his approach works.

Be warned: He moves pretty quickly and you really get the impression that his mind is moving a mile a minute. It’s pretty impressive stuff. And once you see the returns he rack’s up you might start to get a little jealous too.

While the real time experiment isn’t entirely applicable or practical, it’s impressive that George Soros had the gaul to draw a line in the sand and stand by his ideas. It’s also neat how well it worked out (even though he was wrong on a lot of things). This personal diary of trading and investing is a unique perspective I haven’t seen anywhere else.

Once the real time experiment wraps-up, The Alchemy of Finance debriefs the experience. It then goes on to highlight some other areas of the world (such as commodity markets and central banking) that could benefit from embracing the reality of reflexivity.

The Alchemy of Finance was a pretty neat book and overall I enjoyed reading it. But there’s one part of this book that I could have done without.

Where The Alchemy of Finance Fell Short:

The Alchemy of Finance presents you with the notion of reflexivity. But in my opinion, the idea isn’t presented in an effective way. Let me tell you why…

For the first 35-50 pages of the book, Soros talks a little bit about his life and his experience. He explains how he came to be where he is, and what his personal interests and aspirations were. But he does this in an incredibly confusing way.

When The Alchemy of Finance describes the theory of reflexivity in abstract terms, it’s tough to follow along. I found the first 40 pages or so to be difficult to read. And I had to pay a lot of attention to follow along. To his credit, Soros advises that some readers may want to skip ahead and avoid the first chapter altogether.

That said, once The Alchemy of Finance starts applying the ideas of reflexivity to the financial markets, things get really interesting. It’s much easier to understand these ideas when you can see how they work in practice. Make sense?

Now, let’s wrap up this book review.

The Alchemy of Finance – The Final Word:

The Alchemy of Finance is an interesting book written by one of the great minds in macro-driven global finance, speculating and trading. For that reason alone, I think you should buy TThe Alchemy of Finance on Amazon.

But if you want some more information you can also watch the brief video book review below. Thanks for reading along and let me know in the comments below if you end up buying The Alchemy of Finance.

The Alchemy of Finance Video Book Review:

The New Buffettology Book Review

The New Buffettology Book Review

Read this book review of The New Buffettology to see if it’s right for you!

The New Buffettology by Mary Buffett and David Clark shares “The Proven Techniques for Investing Successfully in Changing Markets.”

And I actually picked up this Warren Buffett book after reading another book by the authors, Warren Buffett and the Interpretation of Financial Statements. So was The New Buffettology worth the purchase price?

Well, you’ve certainly come to the right place to find out. In this blog post I’ll review The New Buffettology so that you can get an in-depth look at what this book is all about, and whether or not it’s the right Warren Buffett book for you. So let’s get into it, shall we?

What’s The New Buffettology All About?

The New Buffettology is the third book by Mary Buffett and David Clark. It’s an update to their best-selling Buffettology. So what makes this version new?

The New Buffettology is all about understanding how Warren Buffet makes his investing and capital allocation decisions. And in this regard, this book doesn’t disappoint. It does a good job of walking through the thought process Buffett applies when evaluating potential investing opportunities.

For example…

The New Buffettology explains some of the most important characteristics that a business has to have to be a worthwhile investment to Buffett. From there, it shows some of the key operating highlights and financial items that Buffett pays particular attention to. And not only does the book review these items, it actually explains why they’re important and when there are exceptions. This kind of in-depth examination will be of much value to the up-and-coming value investors who are reading this book review.

From there, The New Buffettology goes on to discuss when and why Warren buys particular stocks. It highlights how he finds buying opportunities amidst stock market panics, corrections and industry recessions. By the time you’re done reading this book, you should have a good idea of how you too can take advantage of stock market opportunities that come around when the bears get control of the tape.

The New Buffettology also then shows a number of case studies. It’s particularly interesting to learn which investments Buffett pursued, and why he made them. The book does a great job digging deep into some of these investments. And while the book contains some of the case studies from the original Buffettology, since it was published many years later it’s neat to see how those original prediction panned out.

But that’s not even the best part of The New Buffettology.

What I Liked Best About The New Buffettology:

One thing The New Buffettology does well is help you learn to apply the lessons of Warren Buffett for yourself. Specifically, the last chapter of this book is basically a worksheet that you can use to help you evaluate your investment ideas. By putting your stock picks and investment ideas through this checklist, you can see for yourself if they are Buffett-worthy investments. Pretty cool, right?

Of course, the worksheet isn’t perfect. And you’ll want to do more due diligence of your own. But if you’re just getting started out with value investing this is a great place to get going. It’s easy to understand and entirely actionable. What’s not to love?

Unfortunately, The New Buffettology isn’t perfect. And before you rush out to buy this book, you may want to

Where The New Buffettology Comes up Short:

The New Buffettology is a great book. And it’s an interesting look at the thought-processes and school of thought that helps guide Warren Buffett in his capital allocation decision-making. But at times, the book is a little bit too vague.

There are some chapters that discuss Buffett’s approach in relatively broad strokes. And while there are pockets of insight and value, you need to read between the lines a little bit to really extract the applicable value-added insights.

On the other hand, Warren Buffett and the Interpretation of Financial Statements (by the same authors) is much more actionable. In contrast, I’m having a little more trouble applying the knowledge from The New Buffettology. But it’s still ripe with learning opportunities, especially if you haven’t read too much about Warren Buffett before.

So where should you go from here?

The New Buffettology – The Final Word:

I really enjoyed reading The New Buffettology. It’s always great to learn investing lessons from the legends. And there’s no better legend than Warren Buffett, right? For that reason, and because of the worksheet in the final chapter, I encourage you to buy The New Buffettology on Amazon so you can soak up this wisdom for yourself.

But if you’re still looking for a little more information, check out the video book review. It’ll give you even more information on The New Buffettology and whether or not it’s the right value investing book for you.

The New Buffettology Book Review:

Warren Buffett and the Interpretation of Financial Statements Book Review

Warren Buffett and the Interpretation of Financial Statements Book Review

Read this book review to learn about this investing book.

Warren Buffett and the Interpretation of Financial Statements, by Mary Buffett and David Clark shows you “The Search for the Company with a Durable Competitive Advantage.”

This book review will walk you through Warren Buffett and the Interpretation of Financial Statements, so you can decide if this is the right financial book for you. And guess what?

In this book review I’ll not only tell you what I liked and disliked about this book.  I’ll also answer the other burning questions you have, like who is Mary Buffett? And does this book accurately represent the Warren Buffett approach to value investing.

Hopefully my perspective will prove helpful for you. I’ve read plenty of Warren Buffett books and have studied Buffett’s investment strategies in-depth. So I feel qualified to give you a clear answer as to whether Warren Buffett and the Interpretation of Financial Statements is the right book for you.

Why I Liked Warren Buffett and the Interpretation of Financial Statements:

Warren Buffett and the Interpretation of Financial Statements was a great book. I was actually surprised how good it was.  I wasn’t even going to buy this book, but I really needed something quick in a pinch. I’m glad I picked it up.

The main reason why I liked Warren Buffett and the Interpretation of Financial Statements so much is because it’s exactly what it sounds like. The book has one or two quick introductory chapters about Warren Buffett and his overall investment approach. And then from there, it just gets down to business.

The book dedicates each chapter to a line on each financial statement. It then methodically goes through the income statements, balance sheet and cash-flow statement. And of course, the chapters don’t just talk about the financial line items. They discuss how Warren Buffett would interpret each particular.

It’s perfect.

I was actually surprised how this book was so focused on the meat and potatoes of the financial statements. It was really quite educational. And even though I’ve read The Intelligent Investor and Security analysis, for some reason this book made it all click. I think the reason is…

Warren Buffett and the Interpretation of Financial Statements is so focused on helping you understand the facts that it lays out an actionable roadmap you can follow to interpret financial statements in a Warren-Buffett-Like manner.

This also makes Warren Buffett and the Interpretation of Financial Statements a great reference book to keep around your office. It’s really handy to

But wait, I know what you’re thinking?

Who are the Authors?

When people write about “what Warren Buffett would do” I’m always skeptical. I mean, why are they writing books if they know how to get so rich, right? But in this case, I was reassured.

Mary Buffett is the former daughter-in-law of Warren Buffett. She was married to his son for 11 years, and presumably has spent some time around the Buffett household.

David Clark, the other author is a practicing “Buffettologist” living in Omaha. He studies Warren Buffett and runs an investment fund. So it seems the authors of this book are more than just passing Warren Buffett fans.

But other than that, there’s one other thing about the book I want to warn you out.

While Warren Buffett and the Interpretation of Financial Statements is a great book to help you improve your value investing, it’s not perfect. The book is only about 170 pages long. And the pages are pretty small. So while the book moves quickly, it’s also necessarily a little simple.

I think I got more out of this book because I’ve read so many other essays, letters and books by and about Warren Buffett.  While you can definitely read this book early in your investment career, I think you’ll get more out of it if you focus on some of the fundamentals first.

Now, let me share the best part with you…

The Best Part of Warren Buffett and the Interpretation of Financial Statements:

Warren Buffett and the Interpretation of Financial Statements is a great book. But my favourite part is they give specific measures and metrics for you to use as a yardstick when evaluating financial statements for yourself.

Whether it’s a balance sheet, cash flow or income statement, this book gives you specific benchmarks to keep in mind when you’re evaluating your own stock ideas. What more could you ask for?

I think the one thing that would make Warren Buffett and the Interpretation of Financial Statements an even better book was if it contained a summary table with all of the stats and figures they mention. I’m seriously contemplating making one.

Now let’s wrap this up…

Warren Buffett and the Interpretation of Financial Statements – The Final Word:

Warren Buffett and the Interpretation of Financial Statements is a great investing book that I recommend to value investors of all shapes and sizes. It’s a good refresher on the fundamental best practices of financial analysis. And it’s really easy to understand. For those reasons alone I recommend you buy Warren Buffett and the Interpretation of Financial Statements on Amazon.

If you’re looking for a little more information, check out the video book review of Warren Buffett and the Interpretation of Financial Statements below.

The Value Investors Book Review

The value Investors book review

Read this book review of The Value Investors by Ronald Chan!

The Value Investors, by Ronald Chan provides “Lessons from the world’s top fund managers.”

So is Value Investors all it’s cracked up to be?

Well, the truth is, I was headed to the beach and needed some light reading. So this compilation of value investors biographies and interviews seemed like it would fit the bill. In this book review you’ll see how this little reading day at the beach turned out.

I’ll tell you what I liked about The Value Investors, as well as where it came up short. That way you can decide if this is the right finance book for you.

Now let’s get into it.

What I Liked About The Value Investors:

The Value Investors is much like Market Wizards, in that it features one prominent investor per chapter. As I was hoping for, this made the book pretty easy to read. If you have to commute to work and need something that doesn’t require concentrated focus for one chapter after another, this book would be great for you.

The Value Investors is easy to read. And some of the individuals that are interviewed and featured in the book are very prominent personalities, within the value investing community. If you’ve read the Appendix in, “The Intelligent Investor” you’ll recognize a lot of these names. It was great to get these perspectives in an easy to digest format.

While there are lots of stock market biographies, this book does a good job gathering up a diverse and global contributor base made of leading value investors. And leaders they are. This book interviews a number of investors who have made double digit returns for decades on end. It’s really quite incredibly.

The Best Parts of The Value Investors Book:

The Value Investors was a fun, educational and easy to read book that was exactly what I was looking for. You don’t want to read a text book like Security Analysis every day, do you? But here are the two best parts of The Value Investors…

(1) First, this book features a great cast of characters. I would have bought it just for the interviews with Walter Schloss and Irving Khan.

(2) Second, this book features a global array of value investors. It does a great job illustrating the different approaches to value investing that exist around the world. It’s insightful to get these perspectives that you otherwise might not have seen.

Where “The Value Investors” Falls Short:

The Value Investors is a great book. And it’s hard for me to point fault. But I always try to find one or two things that critical readers might want to know ahead of time. So to that note, and as I’ve hinted throughout this book review…

The Value Investors is a little bit of a light read. While there are definitely a ton of educational tidbits sprinkled throughout the book, it’s by no means methodical or comprehensive. You won’t learn how to do value investing from this book. It’s great supplemental knowledge. And there are some big hints about how these prolific investors value companies. But I’m not convinced you’ll have a light bulb moment either.

All that said, I really enjoyed reading The Value Investors. And if you’re looking for interesting and insightful biographies of some of history’s time tested value investors, you will too. So let’s wrap this up.

The Value Investors – The Final Word:

The Value Investors is a great book that describes the approaches to life and investing of many of history’s most successful value investors. All of the investors featured in this finance book have decades of experiences outperforming the stock market. It’s for that reason that I recommend you buy The Value Investors on Amazon if you’re curious. They usually have a pretty good discount.

If you’re looking for more information on The Value Investors, I encourage you to check out the video book review below.

The Value Investors Video Book Review

Value Investing by Martin Whitman Book Review

value investing martin whitman book review

Find out why Value Investing by Martin Wthman is a great book.

Value Investing, by Martin Whitman provides a “balanced approach” to investors.

And by the way, even though you may not have heard of Martin Whitman, he’s an incredibly smart value investor, author and thinker. If you’re curious, here’s his recent letter to shareholders, on en Graham and HFT.

So in this book review, we’ll take a close look at Value Investing, to see if Martin Whitman’s approach to markets makes sense. And to decide if this is the right value investing book for you. Now let’s get to it.

Why Value Investing is Worth Reading:

Value Investing was published in 1999, so it’s a relatively contemporary look at value investing (compared to the likes of Security Analysis and The Intelligent Investor). And yet the level of thought is just as good.

Whitman provides a modern look at value investing that’s concise, to the point and bound to improve your investment decision-making process. His discussion is actionable and focused on helping you make smarter decisions in the stock market.

When I first started reading this book, I was expecting just another take on the old Graham and Dodd idea. But Whitman’s value investing book actively compares and contrasts his interpretation of value investing with Graham and Dodd fundamentalism, as well as short term trading and efficient market theorists. This well-rounded approach makes his arguments entirely more convincing. And powerful.

Speaking of, there are a ton of great lessons that Value Investing conveys. Let me show you what I mean…

Best Parts of Value Investing:

Value investing is great book with a ton of valuable insights that are bound to boost your portfolio over the long term. But here are some of my specific favorites…

  • Outside Passive Minority Investors (OPMI) Whitman’s book quickly introduces the term OPMI. And it refers to the average individual investor participating in the stock market. His whole book addresses things in terms of this audience, relative to the way insiders and financial institutions can play the game. It’s illuminating.
  • Markets are Everywhere Whitman makes it clear that value investors don’t just think about the OPMI stock market price (e.g. what you can sell your stock for on an exchange right now). Instead, value investors look for opportunity in M&A markets, LBO markets and going private markets. Think outside the stock exchange.
  • How Other Market Participants Think Along the same lines, Value Investing gives illustrative examples of how other participants, like Wall Street promoters and underwriters, as well as corporate insiders, are working the system. When you can see what you’re up against as an OPMI it help you make better moves and maintain your composure.

And this is just the tip of the iceberg. Value Investing has even more valuable points that you’ll have to read for yourself.

But while I really enjoyed reading Whitman’s Value Investing book, it’s probably not for everyone. Just allow me to explain.

A Word of Warning About Value Investing:

Value Investing is a great book, about just that: Value investing. It’s extremely focused on this topic, so if you’re a day trader or short term technical analyst, I can’t recommend Value Investing for you. Furthermore…

Value investing is also a big of a technical book. It’s not an entirely easy read. And if it was the first book I read on value investing I might have been overwhelmed. For beginners, I think it makes sense to read The Intelligent Investor first.

Because the truth is:

Value Investing is a relatively short book and it cuts to the chase pretty quickly. You might find it a bit overwhelming if you aren’t familiar with basic investing terminology. Make sense?

So let’s wrap this up.

Value Investing – The Final Word:

Value Investing, by Martin Whitman, is a great book for advanced and intermediate value investors. It introduces a number of incredibly important concepts that aren’t touched on anywhere else. For that reason, I recommend you buy Value Investing on Amazon.

If you’re still looking for more information on this value investing book, I encourage you to check out the video book review below.

Value Investing Video Book Review:

stock market analysis august 2014

Top Down Stock Market Analysis August 2014

Here’s a little top down stock market analysis for you, heading into August 2014. To be honest…

I don’t often find this kind of big picture down analysis that helpful. But it’s interesting to think about every now and then. So for the fun of it, here are some thoughts on the top down fundamental and technical picture going into August…

August 2014 Top Down Stock Market Analysis:

  • The Dow Jones Industrial Average has been under the 20 day moving average for a couple of days. And it’s now on the 50 day MA.
  • Previously we talked about a potential homebuilder recovery in 2014. But that seems to be a myth. Just look at the chart of XHB heading into August.
  • Amazingly, US GDP printed 4% growth heading into August 2014. While this might seem like good news, will it cause the FED to raise interest rates sooner? Wall Street logic isn’t always intuitive.
  • The US dollar is absolutely spiking. Pull up a chart of DXY (dollar index) and see for yourself. It looks like it could keep running. This could logically correlate to a draw down in equities. But on the other hand, depending on the move relative to the Yen, the carry trade might not unwind after all. Confused yet?
  • Junk bonds are finally getting hit hard. Is this a warning sign of things to come? Or could it be that investors are getting more cautious and just asking for higher yields in riskier issues.?

As you can see, it’s easy to muse about all of the confounding factors influencing the stock market, heading into August 2014. But drawing a firm analysis is much harder. Personally, I prefer to focus on what’s within my control and not get too dogmatic about correlations or macroeconomic implications.

Find good companies and trade them well. Simple as that.

And By The Way: If you’re curious about my focused approach to the stock market, I encourage you to download my eBook free below this blog post. You’ll also get weekly updates with some of the best tips and tools to help you improve your approach to the stock market. 

agco pre earnings update 2014

AGCO 2014 Pre-Earnings Update

AGCO is an investment idea I’ve been looking at for a while. Here’s the original AGCO analysis. But because of the recent AGCO technical analysis, I’ve held of from building my position. But you know what?

I can’t stop thinking about AGCO. It’s a wonderful business and it’s  significantly cheaper than the S&P-500 average no matter how you slice it: Price/Earnings, Price/Book, Price/Sales, Price/Cash Flow AGCO looks undervalued (source). And valuation aside…

The business fundamentals look strong. AGCO management is focused on margin improvement and expanding their global footprint. The company is aggressively buying back shares. So here are some factors I’m thinking about before AGCO reports earnings next week:

AGCO 2014 Pre-Earnings Update:

  • I don’t like to give insider buying too much credit. Because managers aren’t necessarily good investors. But when someone takes a massive stake, it’s hard not to pay attention. In this case, Mallika Srinivasan has directly and indirectly acquired over 5.6M shares of AGCO (AGCO insider buying data from So who is this mysterious buyer? Mallika Srinivasan is a former Ernst and Young Entrepreneur of the year and Chairman and CEO of TAFE, a $1.6B Indian tractor manufacturer. She’s also on the board of AGCO and TATA motors. Draw your own conclusions from this.
  • AGCO sells farm equipment through a network of dealers. So connections in the agriculture company are obviously important. An AGCO executive getting elected to president of CEMA – the association for agricultural machinery in Europe – seems like a positive development for AGCO’s influence in Europe.
  • AGCO has some exposure in Russia and Ukraine, which some cautious investors might see as a red flag. But AGCO operates in over 140 countries around the world. So it’s likely the influences of any regional conflicts will be minimal.
  • Going into earnings, analyst expectations are mixed on AGCO. But even though the average rating is HOLD, the average price target of $59 represents almost 15% upside from here.

What do you think about AGCO going into earnings this year?

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