myinvestingnotes.blogspot.my (Bullbear Buffett Stock Investing Notes)

Keep INVESTING Simple and Safe (KISS) ****Investment Philosophy, Strategy and various Valuation Methods**** The same forces that bring risk into investing in the stock market also make possible the large gains many investors enjoy. It’s true that the fluctuations in the market make for losses as well as gains but if you have a proven strategy and stick with it over the long term you will be a winner!****Warren Buffett: Rule No. 1 - Never lose money. Rule No. 2 - Never forget Rule No. 1.

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Saturday, 29 September 2018

Psychology and Investing: Mental Accounting and Framing Effect

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Most of us separate our money into buckets - this money is for the kids' college education, this money is for our retirement, this mone...

Psychology and Investing: Confirmation Bias and Hindsight Bias

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Confirmation Bias How do we look at information? Too often we extrapolate our own beliefs without realizing it and engage in confirmati...

Psychology and Investing: Anchoring

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When estimating the unknown , we cleave to what we know. Investors often fall prey to anchoring. They get anchored on their own estimat...

Psychology and Investing: Sunk Costs

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Sunk cost fallacy is another factor driving loss aversion. This theory states that we are unable to ignore the "sunk costs" of...

Psychology and Investing: Loss Aversion

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Loss Aversion Many investors will focus obsessively on one investment that is losing money , even if the rest of their portfolio is in th...

Psychology and Investing: Self-handicapping

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Self-handicapping bias occurs when we try t o explain any possible future poor performance with a reason that may or may not be true. Thi...

Psychology and Investing: Selective Memory, Cognitive dissonance and Representativeness

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Selective Memory Few of us want to remember a painful event or experience in the past, particularly one that was of our own doing. In t...

Psychology and Investing: Overconfidence

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Overconfidence refers to our boundless ability as human beings to think that we are smarter or more capable than we really are. Such opti...
Thursday, 27 September 2018

What Matters and What Doesn't

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It is very easy for new stock investors to get started on the wrong track by focusing only on the mechanics of trading or  the overal...

My Golden Rule of Investing

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My Golden Rule of Investing:   Companies that grow revenues and earnings will see share prices grow over time. Over the long term, whe...

The market frequently forgets the important relationship between Return on Capital and Return on Stock

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Return on Capital Return on capital is a measure of a company's profitability.                 Return on Capital = Profit / Investe...

Why Stocks Perform the Best

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Why, exactly, have stocks been the best-performing asset class? Why should we expect those types of returns to continue? Why should we ...

It is important to have a long-term investment horizon when getting started in stocks.

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Time is on Your Side Just as compound interest can dramatically grow your wealth over time, the longer you invest in stocks, the better o...

Volatility of the Stock Market

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One way of reducing the risk of investing in individual stocks is by holding a larger number of stocks in a portfolio. However, even a p...

Volatility of Single Stocks

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Volatility of Single Stocks Individual stocks tend to have highly volatile prices. The returns you might receive on any single stock ma...

With compound interest, the last few years of compounding make the most difference.

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The 3 components that determine how much money you will have in the future are: 1.  the amount of money invested, 2.  the length of time...

Why Invest in Stocks?

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Why stocks? Stocks are but one of many possible ways to invest your hard-earned money. Why choose stocks instead of other options, such...
Wednesday, 26 September 2018

Understanding Your Circle of Competence

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If Buffett cannot understand a company's business, then it lies beyond his circle of competence and he won't attempt to value it. ...

Concentrating on Your Best Ideas

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Buffett has difficulty finding understandable businesses with sustainable competitive advantages and excellent managers that also sell at d...

Successful investing requires the rare ability to identify and overcome one's own psychological weaknesses.

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Successful investing is hard, but it doesn't require genius. Once you have ordinary intelligence, what you need is the temperament to...
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