The ins and outs of bull and bear markets
During a bull market, the market takes a series of steps higher along with a few steps lower. Over time, the moves upwards are larger than the steps downwards. This leads to price rises over time.
In a bear market, the market tends to take a few steps lower, and then moves a little bit higher. Over time, the moves downwards are larger than the steps upwards. This leads to losses over time.
Typically in South Africa, hedge-fund managers or financial analysts will invest in their specialised markets. And they will buy shares they think will increase when the JSE increases and vice versa.
But is this technique really the ultimate way to profit from the stock market?
There’s one strategy I use that profits in any kind of market
Personally, I believe owning a share represents an investment in the company. That’s why understanding the company’s financial statements, industry trends and profit expectations are just a few of the many indicators I use to pick the best stocks. I also determine whether the company is worthy of your hard-earned cash before you invest in it.
Yes, I can research many companies for countless hours and find everything I need to know about them.
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If you appreciate quality then this is the investment service for you
I want to send you my very latest share tips, reports and investment advice... so that you have the best possible chance of making huge gains in the coming months and years.
And, you can try the Unconventional Millionaire's Stock of the Month service for THREE months under no obligation to continue so you can make an informed decision.
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Membership is strictly limited. Only the first 750 names will qualify...
But the real secret to my share selection system is, I test every stock against 12 of the world’s greatest investors' strategies
. Why? Because each one of them has a proven strategy irrespective of irrational, emotional reactions to the market.
And the secret to my success has been the way I combine the results of each of their proven investment strategies which has ensured for the past five years, the portfolio I’m in charge of – the Unconventional Millionaire Stock of the Month
portfolio has thrived irrespective of the market environment.
So much so – that today it’s standing on average returns of 203% relative to the JSE’s 74%.
Let me give you some insight as to why it works
1. Warren Buffett views stocks as long term investments.
Warren Buffett doesn’t look at the tiny market movements of a stock. Instead, he focuses on a company's core business. He believes that a company with strong businesses and good long-term prospects are likely to grow faster.
He describes these companies as having a durable competitive advantage.
And using Warren Buffett’s “Patience” strategy – I unearthed a small technology stock, EOH.
In just 5 years it has grown to become the biggest technology company in South Africa and so far delivered a 878% return – and its still going strong!
2. Peter Lynch’s says buy what you know.
He believes that the faster a company’s growing, the higher the P/E multiple you should be willing to pay for its stock. Using Peter Lynch’s approach, I discovered an underrated financial services company, Sekunjalo (now African Equity Empowerment Investments), in 2015 that has delivered 164% in just 8 months.
3. James O’Shaughnessy
-- A message from Timon --
NO effort, NO skill, NO hassle...
I'm going to cherry-pick what I believe are the very best money-making opportunities and rush them to you
Every day I see dozens of potentially good trades – and each and every one needs analysing, watching and judging. Most of these trades will end up being ditched...
But I’ll send you my choice trades, as soon as I’ve verified their potential. That means using my experience to check and double check that these trades are red hot, then making a few calls to see if there’s something going on behind closed doors that I should know about.
But once a trade has ticked all the boxes, I’ll send you all the details you need in an SMS and a follow-up email, so you can get in on it without spending hours in front of a laptop trying to figure things out on your own.
Interested? Read more here...
back-tested 44 years of stock market data from the comprehensive Standard & Poor's Compustat database to find out which quantitative strategies worked and which didn’t. He developed two investment strategies. One for growth investing and one for value investing. And using James O’Shaughnessy’s “growth” strategy, I pinpointed Woolworths as a buy and in 36 months, it returned a whopping 127%.
4. Benjamin Graham
looks to buy stocks that are extremely undervalued
. To test this out, he developed one of most valuable investment concepts called the margin of safety – which shows you if you’re buying a stock at a discount. And that’s just what I did. Using Benjamin Graham’s famous margin of safety concept, I revealed a stock in the January issue of the Unconventional Millionaire Stock of the Month
that’s trading at 67% discount. So far this stock is up 13.64%.
These are just a four of the 11 investment approaches I use to pinpoint ordinary stocks which offer extraordinary wealth opportunities for my Stock of the Month readers.
Knowledge brings wealth,
Editor, The Unconventional Millionaire's Stock of the Month
If you’re interested in learning more about this approach and the Unconventional Millionaire Stock of the Month
service, you can read more here