Gold & Silver
The best thing you can do with your money is make your home and living conditions as safe and comfortable as you can. Prepare for the rest of your life with insurance, stock up on your water and food, and get yourself educated. Leaving your money in a bank beyond the need for bill-paying liquidity is increasingly questionable policy. After investing in yourself, your home, and your living conditions, be sure that your nest egg is safe. Only extra money that you can afford to put into good, solid stocks is worth doing when the risk is analyzed and acceptable. Your nest egg should not be in stocks. First set aside that nest egg into gold and silver. Do not buy collectibles. Their premium over the spot price is too high. Investigate the suppliers and their premiums carefully and take possession of what you buy.Most important: investing and speculating are different. Too many people think that when they buy something they're investing. Sorry, a car is not an investment. A home is a liability if you have more debt than equity. Without applying a method to attempt achieving measurable gain, such buying and selling activities are speculation.
The stock market interested me since my grandpa (father's father) showed me how to read the newspaper listings when I was about seven. Noticing certain patterns and behaviors related to them, I developed a method for selecting stocks. Stocks are not the only way to invest, nor are they always the best way. On this page is an ongoing experiment with my picking method.
Benjamin Graham devoted the first chapter of his book, The Intelligent Investor, to identifying the difference. On page 1, he quoted from his 1934 book, Security Analysis:
An investment operation is one which, upon thorough analysis, promises safety of principal and an adequate return. Operations not meeting these requirements are speculative.
Graham spends the rest of his first chapter reviewing development of his investment vs speculation definition. Safe and adequate are definable and their degrees can vary from one person to another. Risk always exists. Just picking any old stock, such as a favorite manufacturer, is speculating. Have reasons for selecting. Reasoned expectations must exist that the stock will appreciate. Although we are not precognitive, have some investment justification to your choice.
I will not outline my selecting method here. Results of my ongoing experiment appear on this page, updated weekly. Investment perspective is long-term. As such, pay little attention to a stock's daily price fluctuations. Instead, update weekly to prepare for activity, if any, in the following week.
Note that there are two different classes of holding objectives: Income and Capital Gains. Any other objectives are typically someone trying to get you to buy more to generate commission for them.
Income selections prefer capital preservation. Temporary loss preferably is short term and does not exceed the income generated over the long term. The income generated should assist in the fight against inflation.
Selections for Capital Gains have the following objectives:
Capital Gains stocks have certain performance tracking characteristics:
Each week shows two lists in the left column: Income and Capital Gains.
The Capital Gains Report is divided into three groups, Buy, Hold, and Sell. However, tracked stocks do not enter the Buy list often, so this is really an Accumulate list. A stock is a Buy when it enters this list for the first time. Stocks not qualified for continued accumulation remain in the Hold list until they requalify for accumulation or move to the Sell list. Columns specify:
The next set of report columns show market index tracking for the same period as the stock on the same line. Index values run through the same Rise and Apr calculations as stocks shown on the same line for the same period. Index columns specify:
Primary Market Indexes: Three well-known market indexes used for this comparison are the Dow Jones Industrial Average (DJIA), the Standard & Poor 500 (SP500), and the New York Stock Exchange composite index (NYSE). Above their titles are their values at the market close on the date near the upper left corner. Below their titles are their Apr (compounded annualized) rates of increase or decrease during the period of the stock holding on the same line.
Avg Mkt: Simple average of the three market index Apr columns for the same line. Although it is not necessarily a worthwhile single number because the three indexes measure differently, it gives an overview of what happened.
Rez vs Mkt: Difference between the stock's Apr and the Avg Mkt. This represents how well or ill the stock selection did compared with the market. Instead, one can easily compare the Apr column against the individual index numbers. It is possible for a stock to do poorly and outperform the market, or for a stock to do well on its own and yet fall behind the market.
Buy/Now/Gain/Rise: Each of the three market indexes has a Buy, Now, Gain, and Rise column holding the index's closing values on the Buy Date and the Sell Date or date near the upper left corner. While most of these index columns run off the edge of the first page onto later pages, they are available for study. The more important Apr results are in the easier viewed beginning of the report.