When researching companies to invest in, you might jump straight to profits, earnings per share (EPS) and dividends.
These key figures are easy to grasp and understand. Yet, you should spend more time looking into a company's cash flow. This is its lifeblood.
A great company generates lots of surplus cash (free cash flow) over the long-term. The company can use this cash to reward its shareh... ››› more
It can be hard to know where to look when you're trying to weigh up a company and its future potential.
Do you look at earnings, dividends or profits? Or should you look elsewhere?
If you want to dig deep and discover what's really going on behind the scenes, you need to look at a company's cash flow. And the best way to do this is to construct a ‘sources and uses statement'.
So how can... ››› more
Finding cheap stocks is one of the best ways of increasing your chances of making money when you invest.
But finding cheap stocks has its pitfalls. Some investment strategies can point you towards stocks that are financially unstable and not good investments.
So what can you do to find cheap stocks?
Read on to uncover an investment strategy to help you find cheap stocks…
What is t... ››› more
Even people who aren't interested in investing have heard of Warren Buffett. His success and ability to make good investments has attracted a lot of attention over the years.
What's his secret? Well, Buffett is a strong follower of value investing.
But what exactly is value investing? Have you got what it takes to be a value investor? Why does value investing work so well? And how can you do... ››› more
The F-Score is a series of financial tests that Professor Joseph Piotroski, an accounting professor at Chicago University, created.
Professor Piotroski came up with the F-Score to improve a commonly used investment strategy to find cheap shares. This involves honing in on companies that have low price to book ratios.
So how can you calculate the F-Score?
Read on to find out…
The b... ››› more
If you're looking for a long-term investment strategy, you may think your only option is buy and hold.
But there are other investment strategies to think about.
So what are these other long-term investment strategies?
Read on to find out…
Investment strategy #1: Multi-asset investing
Multi-asset investing is an investment strategy that involves not having all your money in shar... ››› more
As an investor, one of the worst things you can do is pay too much for a share.
If you pay too much and the market has priced in too high an expectation of the company, you're sure to lose money on your investment.
To avoid this risk, you need to find a strategy to help you uncover very cheap stocks.
One popular strategy for finding cheap stocks can actually leave you investing in a fina... ››› more
Buy and hold is an investment strategy that involves buying shares and holding them through thick and thin.
Investment great Warren Buffett is a strong backer of this strategy.
But this investment strategy does have its downfalls. It ignores periods of time when the shares you're holding become very expensive.
So instead of following a buy and hold strategy, let's take a closer look at a ... ››› more
In spite of stringent accounting standards, some companies still flaunt and bend the rules. And if a company's going to do this, chances are it will with its profits.
If you spot a company manipulating profits before you invest, you can avoid an inevitable share price tumble. Or you could even short the share in question.
So how can you check?
You can use the M-Score.
Read on to find o... ››› more
One of the most popular and well-known investment strategies is ‘buy and hold'. In other words, you buy shares and just hold onto them.
But is it a strategy worth sticking to?
Let's take a closer look…
The ins and outs of the buy and hold approach
The buy and hold strategy could be renamed the ‘buy and forget’ investment strategy.
Many investors struggle to sell an invest... ››› more
When you're researching a company to invest in, one thing you're sure to focus on is its profits. After all, you want to invest in a company that's making money.
Even though the vast majority of companies will be very transparent when it comes to reporting profits, this isn't the case for all. Some companies will try to manipulate their profits.
So how can you spot profit manipulation?
Re... ››› more
You probably know that emotions are an investor's worst enemy. So in order to invest profitably in shares, you need to have an investment strategy in place that overrides them.
You might have heard of a trailing stop losses. Trailing stop losses are a great way to keep your emotions at bay by having strict levels that you sell a stock at.
But what if you could improve this strategy?
Read ... ››› more
Sir John Templeton, one of the greatest investors of all-time shared with us his tips on how to become successful in investing.
His words of wisdom can be used as guidelines by aspiring and existing investors to maximize profits.
Here are his sixteen rules for investment success.
1. Invest for maximum total return (after taxes). Determine how taxes and inflation affect your total return... ››› more
Thanks to accounting standards, company accounts have never been more accurate. But this doesn't mean you can be complacent.
You just have to look at supermarket giant Tesco in the UK. In October, it admitted grossly overstating its profits, sending its share price spiralling down.
So if you want to dig deeper into company accounts, what sort of things should you look at?
Let's take a cl... ››› more
If you want to invest some of your portfolio for the long-term into a market that could yield you great returns, you should have a look at frontier markets.
So what are frontier markets? Why are they a good investment opportunity? And what sort of stocks should you focus on?
Let's take a closer look…
What is a frontier market?
A frontier market is of a country which isn’t yet de... ››› more
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