Is there a good site for trading stocks with smaller amounts of money?
Answer
Following is a link to a review of Foster's book "The Lazy Investor".
http://www.milliondollarjourney.com/book-review-the-lazy-investor.htm
I have not read any of his books, but he appears to have some good ideas, but I would disagree with some of his ideas as does the reviewer. Diversification is important. Also, notice that he is writing for a Canadian investor. The strategies would change for a US investor since we live in US dollars and he lives in CA dollars.
Also, his claim of being retired is hardly true. He is a professional writer and public speaker. He probably works very hard and derives significant income from book sales and speaking fees. The criticism he levels at financial planners "if you are so smart why are you not retired?" could be just as easily directed at him.
That said, I believe that most financial planners charge too much and do more damage than good net of their cost. You can do better with a little research. Sticking with simple low-cost strategies consistently over a long time will produce the most reliable results. Some will do better, but most will do worse.
His dividend strategy is really a variation on value investing. High dividend paying companies tend to be value companies. Value strategies have offered higher returns in the past.
Vanguard Value, Vanguard Small Cap Value are index funds that follow a value strategy with very low fees.
iShares Russell 3000 value is a market value ETF and iShares Russell 2000 value is a small cap value ETF.
Dodge and Cox Stock and Vanguard Windsor II are actively managed low-cost mutual funds.
These are all ways you can get into similar strategies with small dollars.
I personally favor index funds like Vanguard and include large and small foreign and domestic. I include both blend and value funds, but avoid growth funds since I believe value offers better long term returns.
Warren Buffet made his fortune as a value investor. He follows the investing principles of Benjamin Graham. Graham's classic "The Intelligent Investor" is a must read for any one who want to pick individual stocks. You could also read "One Up On Wall Street" by Peter Lynch.
A better approach for most investors can be found in "The Gone Fishing Portfolio" by Alexander Green. What Wall Street Doesn't Want You to Know by Larry Swedroe is also good.
If you want to buy individual stocks, educate yourself thoroughly. If you are not willing to invest the time to read a few books, stick with index funds.
I bought my first stock in 1974 and have read many books and I have concluded that index funds offer the best opportunity.
The Greek Philosopher Aristotle said "the more you know, the more you know you don't know." According to behavioral finance, the mistake many of us make is to leap conclusions based on a little information.
If you carefully study investing in detail, you will probably end up as an investor in index funds.
For information on index funds and index ETFs see:
www.vanguard.com
www.ishares.com
www.dfaus.com
Good luck
Following is a link to a review of Foster's book "The Lazy Investor".
http://www.milliondollarjourney.com/book-review-the-lazy-investor.htm
I have not read any of his books, but he appears to have some good ideas, but I would disagree with some of his ideas as does the reviewer. Diversification is important. Also, notice that he is writing for a Canadian investor. The strategies would change for a US investor since we live in US dollars and he lives in CA dollars.
Also, his claim of being retired is hardly true. He is a professional writer and public speaker. He probably works very hard and derives significant income from book sales and speaking fees. The criticism he levels at financial planners "if you are so smart why are you not retired?" could be just as easily directed at him.
That said, I believe that most financial planners charge too much and do more damage than good net of their cost. You can do better with a little research. Sticking with simple low-cost strategies consistently over a long time will produce the most reliable results. Some will do better, but most will do worse.
His dividend strategy is really a variation on value investing. High dividend paying companies tend to be value companies. Value strategies have offered higher returns in the past.
Vanguard Value, Vanguard Small Cap Value are index funds that follow a value strategy with very low fees.
iShares Russell 3000 value is a market value ETF and iShares Russell 2000 value is a small cap value ETF.
Dodge and Cox Stock and Vanguard Windsor II are actively managed low-cost mutual funds.
These are all ways you can get into similar strategies with small dollars.
I personally favor index funds like Vanguard and include large and small foreign and domestic. I include both blend and value funds, but avoid growth funds since I believe value offers better long term returns.
Warren Buffet made his fortune as a value investor. He follows the investing principles of Benjamin Graham. Graham's classic "The Intelligent Investor" is a must read for any one who want to pick individual stocks. You could also read "One Up On Wall Street" by Peter Lynch.
A better approach for most investors can be found in "The Gone Fishing Portfolio" by Alexander Green. What Wall Street Doesn't Want You to Know by Larry Swedroe is also good.
If you want to buy individual stocks, educate yourself thoroughly. If you are not willing to invest the time to read a few books, stick with index funds.
I bought my first stock in 1974 and have read many books and I have concluded that index funds offer the best opportunity.
The Greek Philosopher Aristotle said "the more you know, the more you know you don't know." According to behavioral finance, the mistake many of us make is to leap conclusions based on a little information.
If you carefully study investing in detail, you will probably end up as an investor in index funds.
For information on index funds and index ETFs see:
www.vanguard.com
www.ishares.com
www.dfaus.com
Good luck
What is your opinion of value investing?
Q. I recently read a copy of "The Intelligent Investor" by Benjamin Graham that was an updated version, including commentary and an appendix essay by Warren Buffet. I found the content incredibly interesting.
Can anyone recommend other books on the topic to read? Are you a value investor or no? Perhaps you prefer another methodology?
Thanks, I'm quite interested in this topic right now.
@Scot I have already read it :). I was wondering your opinion / whether you could recommend another resource on the concept.
Can anyone recommend other books on the topic to read? Are you a value investor or no? Perhaps you prefer another methodology?
Thanks, I'm quite interested in this topic right now.
@Scot I have already read it :). I was wondering your opinion / whether you could recommend another resource on the concept.
Answer
The following books are all related to value investing:
One up with Wall Street by Peter Lynch
You can be a stock market genius by Joel Greenblatt
Security analysis by Benjamin Graham and David Dodd
Quality of earnings by O'Oglove
The Essays of Warren Buffett vy Lawrence Cunningham
Contrarian Investment strategies by David Dreman
The following books are all related to value investing:
One up with Wall Street by Peter Lynch
You can be a stock market genius by Joel Greenblatt
Security analysis by Benjamin Graham and David Dodd
Quality of earnings by O'Oglove
The Essays of Warren Buffett vy Lawrence Cunningham
Contrarian Investment strategies by David Dreman
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