December 14, 2006 –
The following are all opinions for what is going to happen in 2007. Please feel free to disagree, but let me know why. [more]
December 05, 2006 –
I have been an investor for 30 years. I am an accountant by trade and am comfortable reading income statements, balance sheets, and cash flow statements. I am also aware of how they can be manipulated. Trust me when I tell you that whatever laws have been passed since the Enron scandel, there is still plenty of manipulation going on in CEO & CFO offices accross corporate American. That's a whole other blog. My point is that I know what is important to me when I look at these statements. I also have a few advisors that I trust are trying to be accurate and objective - and none of them work for Merril Lynch or Smith Barney. Even among the advisors I follow do I rarely get exactly the same view of the company. Today I was looking at Chubb Corp. One advisor gave them an A (their highest) rating; a second gave then a 5 start (their highest); and the third one gave them 1 star (their lowest). I think the formula for the third one wasn't adjusted for their stock split adjusted price, but perhaps they know something that no one else does. Ok, I'm getting to my point. I joined CAPS in hopes of getting some new ideas and perhaps helping some other folks out. I am a little concerned about the formula that is used to determine the top leaders. Putting money into what I believe is a great company for the long term is my definition of investing. Putting money into a questionable company for the short term because you think you can make a few quick bucks is speculation. I invest. I do not speculate. This is right for me and by no means is it right for whoever may be reading this. I have, however, done very well INVESTING over the last 30 years. So, I did my own simply analysts of the top three (at least at the time I did the anaylsts) leaders. It was a simple anaylsis. I looked at the 75 oldest picks and how many were beating the market and how many were not. Under this measurement, a flip of the coin over a large enough group would give you 50% beating and 50% lagging. If my idea here is flawed, please feel free to respond. I am always willing to learn from my mistakes as it makes me a better investor. So, what were the results? The top person was right 44% of the time and wrong 56% of the time. The 2nd person was right 35% of the time and wrong 65% of the time. I have chosen not to follow these two. That is my choice and you may feel differently. The 3rd person on the list at the time was right 70% of the time and wrong 30% of the time. In addition, that person's accuracy rate for all picks, which exceeded 190 at the time, was a little over 68%. If you want to know who that is, check my favorites because I have decided to watch what this person is doing. [more]
Terms & Conditions
RSS Headlines
Fool UK