Category Archives: CFA Level 1

Whats your investment strategy

Whats Your Investment Strategy?

Over the years, I’ve written (and read!) about all sorts of different investment styles. Here on, you can find blog posts and videos about everything from buy-and-hold value investing, to day trading penny stocks.

But even after all this, I haven’t made it clear what my own investing style is.

So are you curious?

Consistent with my recent post about my own journey to financial independence, I wanted to share some information about my own investing style.

My Stock Picking and Investment Strategy Explained:

As you undoubtedly know, there are a myriad ways to approach the market. And everyone has their own style when it comes to grinding out a profit. For me, it’s about putting the odds on my favour in both the short and long term.

So how do I do it?

First, everything I do is grounded in a value investing methodology. I like buying bargains, and stocks that are selling at a discount to a conservative estimate of intrinsic value may offer a valuation tailwind. In this way, Security Analysis and The Intelligent Investor were big influences on my thinking. But I’m not just looking for any old cigar butt.

That’s because quality counts. As explained in the book The New Buffettology (and The Warren Buffett Way), companies that can compound capital over the long term make very appealing investments. So I’m also focused on finding quality companies. In fact, I have a database of over 300 of just these kind of stocks. And I’m always making additions and subtractions.

But I don’t stop there.

That’s because after years of trying to bottom-fish stocks trading at 52 week lows, I’ve found that a little technical analysis can go a long way. Books like Secrets for Profiting in Bull and Bear Markets convinced me that a few technical filters can go a long way. The results have paid for themselves.

To that end, I try to buy high quality companies, at or below my estimate of intrinsic value, and I only do so if the stocks are making higher highs and higher lows. It’s one of the most often quoted pieces of trading advice, but I must admit that the trend has been my friend.

Technical analysis also helps with risk management. I use stop losses because I don’t like to see my capital tied up in losing or languishing stocks.

And finally, I’ve relied on books like Trading in the Zone and What I Learned Losing a Million Dollars. These focus on the psychological side of money management. Sticking to your plan can be easier said than done.

Now, I could go deeper. But there’s no sense bogging you down in the details. So I hope this overview provides you with a bit of context for the content on this blog, and how I’m investing in my own stock ideas.

By the way, while my investing strategy evolves incrementally, it’s been the same for a long time.  I improve one sprint at a time in a very methodical way.  A lot of trading and investing results come down to the mathematics of positive expectancy. And once you have that done, it’s just about maximizing your edge and profits. Make sense?

But now I want to hear from you. What’s your process for picking stocks?

Market Masters Book Review

Market Masters Book ReviewMarket Masters, by Robin R. Speziale shares proven investing strategies you can apply.

But before we get into this book review, I should let you know that I actually had the pleasure of meeting the author. And…

As you might expect, he’s a young Canadian investor pursuing financial independence. I was lucky to make Robin’s acquaintance and grateful he extended me a copy of his book to review.

So what should you expect when reading Market Masters? Keep reading to find out what this do-it-yourself investing book is all about. Sound good?.

Market Masters Book Summary:

Market Masters is essentially a Market Wizards style book with a Canadian twist. It consists of interviews with successful Canadian investors (and one notable American). The book is packed full of lessons that can help individual  investors regardless of experience level.

One of the things I liked about Market Masters, is that it covered a wide variety of investing styles. The book starts out profiling notable value investors; but from there, it moves across the spectrum of money making methodologies.

While I’m not afraid to dive deep into a subject, like value investing (for example), I really enjoyed how Robin interviewed such a broad range of investors. It kept the book fresh, and I think as a reader I got more value out of learning from different specialists.

In addition to value, the book contains interviews with very successful growth and fundamental investors, as well as technicians and even a trading psychologist (amongst others).  I think this diverse mix of view points makes this book appealing to anyone with an interest in investing. You’ll have to buy it to see for yourself.

My Favourite Part of Market Masters:

I really liked reading Market Masters. I felt like I was there with Robin as he picked the brains of these investing greats. And overall, every one of the interviews was educational and added value. But if I had to pick one…

I think my favourite part was the interview with Jason Mann from Edgehill Partners. I really like how he looked for opportunities that contained not only value, but also price momentum (and catalysts).

And to be honest…

The reason I liked this part of the book is a little bit selfish. While I’m a fundamental investor at heart, I’ve been experimenting quite a bit with adding technical overlays to my investment decision-making process.

The ideas shared in this chapter really resonated with me because Jason Mann had faced some of the same challenges I did when trying to invest on a value-only basis. I appreciate his desire to figure out how to make money now, while still maintaing a fundamental edge and margin of safety.

But that’s just me.

So at the end of the day:

You might disagree with me about the best part of the book. But that’s okay. And that’s the point. I think anyone can probably take some of the lessons in Market Masters and apply some of the ideas to their own investing.

At the very least…

You’ll probably appreciate hearing the struggles that the market masters have had over the years with their own investing careers. Personally, I always find it validating when I know that other successful money managers have overcome some of the same obstacles I face.

So, I’ve rambled on quite a bit about Market Masters. Are you starting to get the picture about this personal finance book? Well, let’s put a bow on it…

Market Masters Book Review – The Final Word:

As you’ve probably guessed by now, I really enjoyed reading Market Masters. And I think you will too. For that reason, why not check it out on Amazon for yourself?

That said, if you’re still loping for more information, then please watch the video book review below. You’ll get even more information on Market Masters. And (especially if you’re Canadian) you’ll probably find that this could be a great investing book for you.

Market Masters Video Book Review:

Zero to One Book Review

Zero to One Book ReviewZero to One, by Peter Thiel, is a great little book about Notes on startups, or, how to build the future.

Pretty compelling, right?

And that’s exactly why I’m so excited to review this book for you today. Although it’s not a strict investing book, Thiel’s musings are definitely rife with business insight. So for that reason, I couldn’t ignore sharing this book with you.

So keep reading. Because this review is going to give you everything you need to help you decide if Zero to One is the right book for you (or your favourite entrepreneurial nephew, perhaps).

Now let’s cut to the chase.

Summary of Zero to One:

Zero to One is a short and easy-to-read book that was based on Thiel’s lectures at Stanford on startups. One of his students, Blake Masters, took exceptionally good notes from the course. And that’s what led to this book.

Essentially, Zero to One shares a framework for how Thiel thinks about business. Each chapter contains a different idea, most of which challenge conventional business wisdom. For example, one chapter is called “Last Mover Advantage” (in contrast to the more common first mover advantage). It’s this kind of counter-intuitive teaching that kept me from putting down Zero to One.

And even though Zero to One is primarily about startups and founder-driven businesses, there’s lots you can learn as a regular self-directed investor or retail trader. The ideas in this book are sure to get you thinking.

By the way, let me also quickly explain the title of the book to you as well…

Explaining the Concept of Zero to One

In Zero to One, Thiel argues that a lot of business resour es are spent on incremental improvement. That is, going from n, to n+1. It’s easy and accepted to make this kind of incremental change on products, projects and companies.

But Zero to One emphasizes a different approach.

The concept of Zer to One is about creating new things. Thiel argues that much more value is created going from nothing to something (0 to 1), vs building a new feature or improving an existing product or service (n+1).

Make sense? I hadn’t thought of this concept before reading this book. But once it hit me I couldn’t shake it. And I’m glad my friend recommended this book to me.

Biggest Weakness of Zero to One:

When doing these book reviews, I always like to provide a balanced view.  But in the case of Zero to One, this is easier said than done. To be honest, my biggest complaint is probably that the book was too short.

The reason is, I really enjoyed Peter Thiel’s thinking and simply wish that I could absorb more of it. That’s hardly a real complaint. And I’m sure there are lots more resources online, which I’m going to look into.

But for now suffice it to say the book does a wonderful job introducing some great business ideas. I just wish it dove deeper into some of them.

Zero to One Book Review – The Final Word:

Zero to one is a really neat business book. It’s easy to read, very intriguing and does a heat job making you question conventional business wisdom. For these reasons, I recommend checking out Zero to One on Amazon.

And by the way, if you still want a little bit more information, I encourage you to watch the video book review below. This will help you further determine if Zero to One is the right book for you.

Zero to One Video Book Review:

RSI divergence trading example 2014

RSI Divergence Trading Examples for 2014

RSI Divergence Trading Examples can help show you one of the most important ways stock traders use the Relative Strength Index (RSI) to  make more money and reduce risk when investing and trading in stocks. So…

In this blog post I’ll show you some actionable RSI divergence trading examples that have stood out to me lately. These recent and relatively current stock ideas will show you some real time examples of RSI divergences.

And when you’re done reviewing the charts below you should have a much firmer grasp of how trading RSI divergences works in practice. Sound good?

Charts of RSI Divergence Trading Examples in 2014:

Take a look at the stock charts below to see some real life examples of RSI divergences. These are happening on major liquid stocks and are available for all to see. I pulled these charts from, where anybody can hunt for RSI divergences free. Take a look…

Bed Bath and Beyond (NASDAQ:BBBY) RSI Divergence Example:

BBBY 2014 RSI Divergence Example

BBBY is a mainstream example of RSI divergences in 2014.

Renewable Energy Group Inc (NASDAQ:REGI) RSI Divergence Example:

REGI 2014 RSI Divergence Example

Sometimes RSI Divergences line up with key events. REGI is experiencing an RSI divergence while completing a controversial acquisition.

IamGold Inc (NYSE:IAG) RSI Divergence Example:

IAG 2014 Positive RSI Divergence

IAG might be an example of a longer-term RSI divergence in 2014.

As you can see from the charts above, there are many mainstream stocks on publicly traded exchanges that serve as great examples of RSI divergences you can swing trade. But there’s one more thing about trading RSI divergences that I should point out…

Trading Bearish and Bullish RSI Divergence Examples:

Now even though the examples above are bullish, you should know that RSI divergences can be traded to the upside or the downside too. So…

Just like the above positive RSI divergences show stocks that are potentially bottoming, a negative divergence can also indicate a potential top in either a particular stock, or even a market index like the S&P-500 or Nasdaq. Make sense?

Of course:

Not all RSI divergences resolve correctly. But it’s another useful indicator you can add to your toolkit to help you tilt the odds in your favor. I find it works especially well when volume patterns support the RSI trends. Now let me ask you…

Do you have any RSI divergence trading examples to share?

CFA Level 1 Ethics Learning Outcomes

cfa ethics learning outcomes level 1

Read this post to learn the CFA Level 1 Ethics learning outcomes…

CFA Level 1 Ethics Learning Outcomes are important to focus on when studying for your CFA Level 1 exam. That’s because while the ethics study session is pretty short, it carries a big weight on the CFA exam, worth 15% of the exam.

By the way, you can also review all of the CFA Level 1 study topics here. Keep in mind these notes are not from the CFA curriculum, but actually from the Kaplan Schweser CFA Level 1 study guides. I really like these guides because they are quite concise and focus in on exactly what you need to know.

So here’s what you need to know for the Ethics and Professional Standards study session of CFA Level 1…

Ethics and Professional Standards Learning Outcomes:

The Ethics and Professional Standards are covered in Book 1, Session 1 – Pages 1-98 of the Kaplan Schweser study guide linked to above. 

1a: Describe the structure of the CFA Institute Professional Conduct Program and the process for the enforcement of the Code and Standards.

1b: State the six components of the Code of Ethics and the seven Standards of Professional Conduct.

1c: Explain the ethical responsibilities required by the Code and Standards, including the multiple sub-sections of each Standard.

2a: Demonstrate and explain the application of the Code of Ethics and Standards of Professional Conduct to situations involving issues of professional integrity.

2b: Distinguish between conduct that conforms to the Code and Standards and conduct that violates the Code and Standards.

2c: Recommend practices and procedures designed to prevent violations of the Code of Ethics and Standards of Professional Conduct.

3a: Explain why the GIPS standards were created, what parties the GIPS standards apply to, and who is served by the standards.

3b: Explain the construction and purpose of composites in performance reporting.

3c: Explain the requirements for verification.

4a: Describe the key features of the GIPS standards and the fundamentals of compliance.

4b: Describe the scope of the GIPS standards with respect to an investment firm’s definition and historical performance record.

4c: Explain how the GIPS standards are implemented in countries with existing standards for performance reporting and describe the appropriate response when the GIPS standards and local regulations conflict.

4d: Describe the nine major sections of the GIPS standards.

So there you have it. Hopefully these learning outcomes will help you improve your studying for the CFA Level 1 exam. If you’re contemplating studying the CFA level 1 exam I encourage you to check out the Kaplan Schweser CFA Level 1 study guides yourself to speed up your studying and improve your results.

And By The Way: If you’re not ready for the CFA exam you can still improve your approach to stock markets by downloading my free ebook below. You’ll learn how I have refined my approach to the stock market over the years. You’ll also get free updates, tools and tips sent to you each week with my favorite stock market resources.

CFA Level 1 Study Topics and Tools

cfa level 1 study topics and tools

Read this if you’re thinking of flexing your analysis muscles with CFA Level 1…

CFA Level 1 Study Topics and Tools are of interest to investors considering their Chartered Financial Analyst qualification. The CFA is largely considered to the hardest test on Wall Street…

So what does this difficult exam encompass?

In this blog post I’ll share the CFA Level 1 Study topics, exam weights and the number of learning outcome statements. By the end of this post you’ll have a great understanding of the CFA Level 1 study topics, and what each section of the exam is worth. But before you review the CFA Level 1 study topics there’s one thing to keep in mind…

When looking at the CFA Level 1 study topics, keep in mind the number of learning outcome statements per section does not correspond to the exam weight. This is a common mistake so just be aware that (for example) even though ethics section only has 13 learning outcome statements it is 15% of the exam. So when reviewing the CFA Level 1 study topics just keep in mind the percentage points per learning outcome. Now…

Let’s get into the CFA Level 1 Study Topics and some of the best tools to help you get started studying for your CFA…

CFA Level 1 Exam Weights and Learning Outcome Statements:

The good thing about writing the CFA Level 1 exam is that the CFA institute makes it easy to find out what you need to prepare for. Here’s a quick breakdown of Study topics, exam weights and the number of learning outcomes:

  1. Ethics – 15% – 13
  2. Quantitative Methods – 12% – 87
  3. Economics – 10% – 94
  4. Financial Reporting and Analysis – 20% – 109
  5. Corporate Finance – 8% – 45
  6. Portfolio Management – 5% – 27
  7. Securities Markets and Equity Investments – 10% – 60
  8. Fixed Income – 12% – 66
  9. Derivatives – 5% – 37
  10. Alternative Investments – 3% – 21

As you can see there are quite a lot of topics in the CFA Level 1 curriculum. There are thousands of pages of reading and over 550 learning outcomes! The CFA is no easy undertaking but being a charter holder is a great way to validate your knowledge of financial analysis.

Other CFA Level 1 Study Tools and Resources:

In addition to the above level 1 exam weights, there are another of other helpful online resources to help you prepare for the CFA Level 1 exam topics. has a lot of great resources to help you get up to speed with CFA Level 1 study topics. Check out the CFA Level 1 Forum to get in on the conversation and start learning from other CFA Level 1 students who are studying as well. There’s also a good discussion thread on CFA study strategy you might enjoy reading.

The CFA institute also provides an in-depth Candidate Body of Resources (PDF). This document will give you a working summary of all the main areas of the exam. I recommend giving it a read before you get started studying the CFA Level 1 topics.

And while you’ll probably want to get your own copy of the CFA study guides and textbooks, Investopedia has a great CFA Level 1 study guide. If you’re having trouble deciding if studying the CFA Level 1 exam is right for you then check out this free guide to see if the study topics are of interest to you. The CFA is a difficult qualification to achieve, requiring 3 exams and years of professional experience. So are you interested in studying CFA Level 1?

And By The Way: If you’re not ready for the CFA but are still curious about improving your approach to stock markets, I encourage you to download my free ebook below. You’ll also get free weekly updates with my favorite tools and resources to help improve your stock trading and investing decisions.