Value Stock Investing Articles

Summary: Typically, 401(k) participants buy the higher priced, last-year-best-performing, and hot sector offerings while they sell or avoid the various products they feel have "under performed" the market. Nowhere else in their lives do they adopt such a perverse strategy. And nowhere else in their thinking would they blindly accept the premise that any one number represents what is, or should be, going on in their personal investment portfolios.

Investment Performance and The Working Capital Model
(March, 2008) 

Summary: The Working Capital Model (WCM) approach to portfolio performance evaluation eliminates the tears and fears because it is based on more than the current market value illusion of wealth--- a number that won't sit still long enough to ever be meaningful. Market value, within the WCM, is used only to determine what to buy and/or when to take profits

Calculating Your Investment IQ
(January, 2008) 

Summary: Investing is as fascinating as it is frantic, as scary as it is exciting, and as intimidating as it is satisfying. But perhaps the most interesting thing about it is how educationally unprepared most individual investors are for the adventure!

Investment Performance Analysis Using the Working Capital Asset Allocation Model
(January, 2008) 

Summary: It matters not what lines, numbers, indices, or gurus you worship, you just can't know where the stock market is going or when it will change direction. Too much investor time and analytical effort is wasted trying to predict course corrections... even more is squandered comparing portfolio Market Values with a handful of unrelated indices and averages.

Summary: What if its true, and these pinstriped super humans can actually predict the future, why do you transact the way you do in response?  Why would financial professionals of every shape and size holler “sell” when prices move lower, and vice versa? Would this pitch work at the mall?  So, if we were to slowly construct a diversified portfolio of value stocks (My short definition: profitable, dividend paying, NYSE companies.) as they fall in price, we would be able to take profits during the following upward cycle…  Hmmm.

Summary: I don't disagree with the need for distinctions such as this, but I have a problem with the lack of consistency in who does the labeling, how unbiased it can possibly be, and then this one big problem: almost any stock out there can be seen as one or the other, even at the same time, by almost anyone who owns a calculator and who thinks they have the ability to predict the future.

Summary: How much financial bloodshed is necessary before we realize that there is no safe and easy shortcut to investment success? When do we learn that most of our mistakes involve greed, fear, or unrealistic expectations about what we own? Eventually, successful investors begin to allocate assets in a goal directed manner by adopting a realistic Investment Strategy... an ongoing security selection and monitoring process that is guided by realistic expectations, selection rules, and management guidelines.