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What Dreams Are Made Of

Top 5 of the Week of October 9

We kick off this week’s Top 5 with a look at cryptocurrency by Aswath Damodaran on his Musings on Markets blog. The Reformed Broker Joshua Brown explains why investors will always need advice. And Bob Seawright, writing for his own blog, talks about the trouble with ‘presentism’.

The staff at Vintage Value Investing share some of Warren Buffett’s most inspirational quotes. And Todd Wenning of Clear Eyes Investing examines the challenging scenarios quality-value investors face…


Which Cryptocurrency Coin Will Win the Toss?

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  • Though the technology is still young and experimental, the popularity of cryptocurrencies has caused a surge on the market recently
  • After just ten years, Bitcoin on its own is valued at over $40 billion and has seen a vast increase in growth in the last two years; prompting the start of many cryptocurrency competitors
  • The problem is, while prominent, none of them have (yet) succeeded in their intention as currencies which makes it hard to find a market winner in the current list

Which cryptocurrency is your money on? Share your comments in the section below

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What Dreams Are Made Of

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  • Investors just starting out may dream of portfolios with $1, $5 or $10 million, thinking that will make them satisfied
  • But the truth is the older you get, you probably dream of peace in the market, sadly, as any rational investor knows—even given today’s current “safe circumstances”— there’s no such thing
  • Which is why we will always need advisors—with their understanding of behavioral investing, they are there to stand firm and help steer us through those times when the market turns against us

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Living in the Now

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  • All too many of us live in the now; not learning from the past and with no plan for the future—a trait many investors may recognize in themselves
  • As a very large percentage of us struggle with delayed gratification, this ‘presentism’ poses a big problem for our ability to plan for retirement
  • Acknowledging this lack of self-control is the first step to beginning to achieve it—though it would be helpful if employers got onboard with better company investment policies for employees too

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Words from Investing Legend Warren Buffett

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  • “Risk comes from not knowing what you’re doing” — Only by thoroughly educating yourself about investing can you begin to be a success at it
  • “A public-opinion poll is no substitute for thought” — Media and popular trends should have a minor influence on your investing decisions, back up your choices with your own strategy and evidence
  • “The only time to buy these is on a day with no ‘y’ in it” — There are some stocks you should just never invest in, so, beware of ones that look too good to be true

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Finding the Right Quality-Value Mix

 

  • An ongoing challenge that quality-value investors face is that rarely do companies match the right mix of management, moat, and price factors
  • The most common scenarios that arise out of this challenge is to “avoid turnaround traps,” “beware quality traps,” and assess “quality at any price?”
  • When it comes to one or more of these being prevalent, take the time to weigh out the pros and cons carefully to best analyze the company

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Top 5 of the Week is a summarized collection of financial investment articles that we like and think you might like too. Having written thousands of pages of equity strategy and company research between us, we understand the allure of the ever-changing world of finance. Investing is an art form—and like everything, something you can work on and improve at. There are some excellent writers out there on the finance web, some offer a running commentary on today’s market, some are doing research, some have tips on how to Become a Better Investor, and some just lift the cloud of fog behind a lot of financial jargon. Each week we will keep you up to date with the top 5 articles worthy of your attention.


 

Anything you would like to discuss about this week’s top 5? Do you have another favorite that isn’t mentioned here? Feel free to add it below. Let’s start a discussion in the comments section!

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DISCLAIMER: This content is for information purposes only. It is not intended to be investment advice. Readers should not consider statements made by the author(s) as formal recommendations and should consult their financial advisor before making any investment decisions. While the information provided is believed to be accurate, it may include errors or inaccuracies. The author(s) cannot be held liable for any actions taken as a result of reading this article. The Become a Better Investor Team doesn’t necessarily endorse any stocks or shares mentioned in the articles or the author of such articles linked to and summarized in Top 5 of the Week and cannot guarantee the accuracy of its information.