Category: Stock Market
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Technical Analysis: Really?
If you’ve studied finance in school, or read books by finance professors, you’ve probably learned that technical analysis “doesn’t work.” In one important sense, that is correct, because when it does work (and it does in the right hands), it tends to produce negative tax consequences (see the end of…
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Novo Nordisk: Time to Sell?
Novo Nordisk shareholders have grown fat even as the obesity drug company’s customers have been losing weight. From relative obscurity just five years ago, Novo Nordisk has become the most valuable company in Europe. The promise of future returns is built into the stock price. In this post, we look…
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Berkshire After Buffett
Last week’s death of Warren Buffett’s long-time “partner”, Charlie Munger, got us thinking about what might happen to Berkshire when Buffett, now 93 years old, either dies or becomes unable to continue as CEO. As almost everyone in the investing world knows, Buffett has been unimaginably successful as the CEO of…
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Do 95% of Stocks Eventually Lose?
Yes, 95% of stocks do eventually lose. That’s the bad news. But there’s good news too. We’ll explain the above claim, and then will suggest a solution. The stock market has generated incredible wealth for investors over the last hundred years. But if you’re not careful, you can lose big, as shown by…
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Why is Warren Buffett Looking So Grim?
Warren Buffett has sold about $23 billion of stock since the beginning of the year, including a recent $2 billion trade in a single concentrated position, Chevron.[1] Buffett has built Berkshire’s cash pile to $153 billion! What does he know that the rest of us don’t? Buffett, arguably the most…
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Recession Warning: Does Falling M2 Signal A Recession?
The M2 money supply rose at an unprecedented pace in the two years following the covid pandemic. In the last year, that same M2 money supply has fallen at a rate not seen since the 1930s. In this post, we explain why the rise and subsequent fall in M2 makes…
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NVIDIA – Look Out Below?
Is Nvidia headed for another wealth-destroying drop? The company lost nearly 2/3rds of its market value as recently as 2021 to 2022! Now the stock is back up, piggybacking on the AI craze. At its recent highs, Nvidia was valued at over $1 trillion. But over the past week, the…
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Do You Make this (Fatal) Mistake?
The mistake referenced in the title is a misunderstanding of withdrawal rate. I was recently speaking with a successful entrepreneur about sustainable withdrawal rates from investment funds, particularly retirement funds. He said that he had heard that 4.5% was a “sustainable” withdrawal rate, and that anything higher was too risky. Yet, we recently…
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Momentum Investing – The Surprising Truth
If you’ve ever studied finance in a university setting, or read the academic literature, you’ve almost certainly been exposed to the Efficient Market Hypothesis. And if you believed the Efficient Market Hypothesis, you would have to believe that momentum trading strategies cannot work, at least not consistently or in the long…
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“QSBS” Stock – More Than $10 Million Tax-Free?
Congress enacted section 1202 in 1993 with the stated purpose of creating an additional incentive for certain types of small business investment. The law allows investors in Qualified Small Business Stock (sometimes called QSBS) to avoid tax on up to $10 million in gains. If you have clients with Qualified…