Investments2019-12-02T05:56:20-06:00

Investments

In general, to invest is to distribute your money in ways that yield returns, usually in monetary value.  Saving money is the most important step because without savings, it’s impossible to invest monetary funds.  You could invest your time, but it is easier to make money work for you.  The following posts will help you ensure every dollar counts.

The Story of the T-Bill: Safe Investments Often Lead to Real Losses

When studying finance in preparation for the Series 65 exam there was an emphasis on specific investment objectives. The "safest" investment objective was "Preservation of Capital" and its primary goal was to prevent loss.  Preservation of capital investments includes Treasury Bills (T-Bill), certificates of deposit (CD), savings accounts, and money market accounts (MMA). These holdings are classified as the “safest” investments and are often insured against absolute loss.  In industry lingo, they generate a “risk-free” rate of return.  But before we take it as so, and solidify the link between "Preservation of Capital" and "risk-free" in our brains, let's see [...]

By |April 23rd, 2018|Investments|0 Comments

33 Countries Ranked by Value

Benjamin Graham, the forefather of fundamental value investing once taught Warren Buffett, “Price is what you pay. Value is what you get”. Since Benjamin Graham wrote Security Analysis in the 1930’s, more academics, quantitative analysts, and Warren Buffett, have made strong cases that value investing outperforms the general market over the long term. In one example, Buffett’s firm Berkshire Hathaway employs value investing, and their track record outperformed the S&P 500 by 1,586,929% over the last 51 years. (1964-2015 Berkshire Hathaway gained 1,598,284% while the S&P 500 gained 11,355%) As we like to build upon our predecessor’s learnings, HIT Investments [...]

By |February 20th, 2017|Investments|4 Comments

Value vs. Price: The Difference is Very Real

Our natural human condition is to know and communicate the price of a product while ignoring the product’s value. Oscar Wilde once said “Nowadays people know the price of everything and value of nothing.” This is a fundamental flaw in how we think and it has played a part in strengthening the consumerism culture we live in today. An everyday example of a marketer taking advantage of this flaw is the marking up of an item by 50% to only then place it on sale for an equivalent 50% off. If we were a value based society, that would be [...]

By |October 10th, 2016|Investments|1 Comment

5 Best Oil and Gas Stocks to Contemplate While Oil Price is Low

Global oil production has been outpacing demand for over two years. This oversupply has pushed oil prices to lows not seen in more than 10 years, so it's a good time to start contemplating investments in oil and gas stocks. For consumers, this is a welcomed reduction in fuel prices. For independent producers, the price decline is causing extreme pain. According to Haynes and Boone, 42 energy companies filed for bankruptcy in 2015 and Deloitte believes 35% of the remaining energy companies are at risk of declaring bankruptcy in 2016. Our in-house analysis found 38 of the 91 independent producers [...]

By |April 11th, 2016|Investments|0 Comments

Stock Buyback – A Dividend Alternative

In the last newsletter we discussed a few of the inherent consequences of dividends. This article compares the dividend to one of its alternatives, the stock buyback. Stock buybacks, otherwise known as share repurchases, occur when a business purchases shares of its outstanding stock from the shareholders. Importantly, the fundamental value of the business does not change. The result is an increase in the ownership percentage of each remaining share. For example, if a company has 100 shares and is worth $100, each share is worth $1 and has a one percent ownership interest. If the company buys back 50 [...]

By |February 29th, 2016|Investments|2 Comments

DividEND: Why it May No Longer Be The Best Option

Businesses should consider the objectives of their shareholders like you and me.  After all, we are the owners of the business. This article explores the dividend and suggests to businesses why the dividend may no longer be the best way to reward loyal shareholders like us. An upcoming newsletter will take a deeper look at an alternative, the stock buyback. How Investors Have Historically Used Dividend Dividend-producing businesses have long provided a steady stream of income to their investors. Historically, investors have depended on dividend income to fund their retirement and pay their monthly bills. Dividend production has also been [...]

By |February 24th, 2016|Investments|2 Comments