Focused Investing - What are you looking at?

September 20, 2006

You are probably looking at your bottom line, wondering how you can get it to grow.  Perhaps you are looking at one more newsletter article on how easy it is to buy the right stock, but still don’t know where to start. 

Do you want to rely on someone else or yourself?  What if you had all the information you need to select the right stock at the right price?  You do, with the right software/database program.

Has it already been suggested to you to create a list of great companies and then watch them all for a price drop?  Have you seen the latest email blast from Motley Fool? It is called “How to Spot Great Stocks”. 

These basic recommendations have been around as long as the stock market itself: “Look for powerful brands (of course, millions of people are buying these, too)”; or look for “consistent, reliable earnings and sales growth”; or look for “strong leadership”.  These all make sense, but how does anyone do this work without spending hours, if not days, a week keeping their list up to date, watching the news, making notes and reading every annual report and periodical they can get their hands on?  Motley Fool’s solution is for you to buy their newsletter. Even with their newsletter, I still like to verify the data myself and I can do it easily and in minutes. A hot tip is not enough to give me confidence; hard facts and reliable data are.

I don’t want to depend on opinions.  I want access to a clean set of facts that let me decide for myself.  I really enjoy checking the touted recommendations against our software/database program to see if the “hot tip” is still hot or not.  Besides, I know that millions of people are reading the same newsletters with the same hot tips.  I do not believe this is the way to find a bargain/good investment. 

Data mining is available to anyone willing to pay for the subscription (but few will actually take this simple challenge to find the best stocks to invest in).  Each individual investor can adjust the criteria to select stocks with our program and with her own due diligence, can really get to know the company she is investing in.

If you are naturally analytical and self reliant, willing to take half an hour to learn a new computer program and already understand the basics of investing, look at this website now, www.FocusedInvesting.com and watch the short introductory video on the home page.  Send your comments and questions to JimLorenz@FocusedInvesting.com

 

Posted by FocusedInvesting at 10:39pm
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Focused Investing

September 17, 2006

Focused Investing could be looked at as the opposite of Modern Stock Portfolio Theory.  Don’t be fooled into thinking that your Financial Advisor is a better investor than you are.

It is your money.  You are the captain of your soul.  Of course, you are going to find out everything you can about your options.  When you are ready to learn about the financial advisor industry, please read our article on “Focused Investing”, under the Get Your Finances in Order section of this blog site.

We are interested in your comments and your inquiries. You can look at www.FocusedInvesting.com or you can email us at smlbusowner@FocusedInvesting.com

We appreciate your interest. 

Posted by FocusedInvesting at 10:10pm
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Investment Education - What Do You Know?

September 14, 2006

Do you read the Wall Street Journal and several other investment focused periodicals?  Do you subscribe to a few newsletters and you are always looking at more information on the Web?  With all this, do you feel that you really know what to invest in?  Are you relying on other people to tell you their opinions or are you relying on an accurate sort through the facts?  Are any of the writers making a commission on what they sell?  If it was all good news, would they sell as many papers?

Personally, I do not have a photograpic memory, as it seems Warren Buffett has.  After just two lists of statistics, though I understand them, the numbers blur.  Since I started using computers, I have come to rely on how computers operate only in facts; not opinions or guesses.  I enjoy running a search and having my faithful computer deliver every bit of information that applies to my query, so I can refine my query and run the search again.  It is a great comfort to me that my computer never tires.  I am continually amazed at the volume of information available. 

I now use my computer to fill in all of the facts.  I no longer subscribe to newspapers or newsletters because they are usually filled with opinion and I would have to verify the facts anyway.  When I save time, I feel like I am doing it right. 

I have a program that sorts through thousands of publicly traded companies in just moments and delivers to me just the few companies that meet my criteria.  Then I use all that know about the market, finding detailed info on the Web, to get to know the companies I invest in. 

After I perform my due diligence, I know what to invest in.  The beauty of this is that every investor has his or her own focus.  The search criteria in this program is easily adjusted with slide bars.  The results happen fast.  I can check the fundamentals of the stocks I am already invested in and research stocks I am thinking about buying in about 1/2 an hour a week.

Curious? Take 10 minutes to look at what we have found, www.FocusedInvesting.com and look at the money back guarantee.  You have nothing to lose and everything to gain.

Posted by FocusedInvesting at 11:01am
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Investing - What do you need?

September 13, 2006

It has been said that when one retires, she will need at least 1/3 of every dollar she made while actively working.  Otherwise, she will need to work part time, even after age 70.

How much do you need?  How much do you want?  What’s the difference?

How old are you now?  If you are under 60, count the number of years between now and when you turn age 70.  If you are over 60, we will catch up with you in a moment.  Ok, so let’s say that you are 42 years old.  That gives you 28 years to work with.  How much do you “net” per year?  This is the money left over after taxes.  Just for this illustration, let’s say it is $60,000.00.  We are going to take one third or $20,000.00 and multiply by 28. 

The amount you need to have invested and generating growth and income for you needs to be at least $560,000.00.  Once you have accumulated this money, and it earns just 3%, you will have $16,800 a year of income.  Occasionally, there will be a big expenditure, probably out of your principal, and so will effect your income, but you get the picture.

If you are over 60 and an independent investor, you will need to pursue the best ways to make your money work for you and your descendants.  If you have not done so, this is a good time to assess what your expectations are, what your needs are and what resources will be available to meet those needs in just 5 to 10 years.

Can you save a third of your income starting now to accomplish your goal?  I find it hard to sacrifice for an uncertain future.  So, I take the sacrifice aspect out of it.  I am gifting my future self with comfort and security.  I have set up automatic withdrawals to add to my savings.  If you have not read, “Automatic Millionaire” by David Bach, it is a solid inspiration.  However, David Bach and I have very different opinions about what to invest in.  He has suggested that the “Automatic” frame of mind continue into investing in Mutual Funds.  I personally think this is disastrous.  I would rather select the companies in which I invest.  Here is the question for the day:

Is your money working as hard for you as you have for it?  Check out, www.FocusedInvesting.com to find out. 

Posted by FocusedInvesting at 12:02am
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Kids and Investments

September 12, 2006

What if you got the concept of compound interest when you were 10 years old?  What if you would have known which stocks to invest in for the long term (more than 10 years) and had the money to invest?
I know that I cannot go back in time, but my kids give me a brand new horizon to dream about.  I recommend the following for you to try with someone who is at least ten.  I have talked to my kids about their horizon using this example:
 Birth __________-_______________-_______________________Death
       You are here ∆        I am here ∆
 

This concept is not new, but it is often “new” to someone who has only been on the planet for ten years.  The next part of the discussion includes asking the young person what he or she really wants to do.  The power of this exercise is to then put a dot on the line as to when your student expects this great thing to happen.  Let your student figure out where to put the dot, assuming death happens at 100.

Then more questions, when will you go to college or get your first apartment?  When will you drive a car or own your own car?  You get the idea.  By now, the kid you are working with will get the idea, too.    How much will you have in cash reserves by 60 years old? Will it last until you turn 100? 

What if you could get this bright shiny kid to understand how to invest and what to invest in, now?  Our kids are more adept than ever in how to use computers, shall we let them waste this talent on video gaming?  If a kid could be motivated to learn about investments, perhaps by making it a game, wouldn’t that guarantee his financial success? 
To learn more, www.FocusedInvesting.com
Make the Most of What You’ve Got!
 

Posted by FocusedInvesting at 10:07pm
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My Investments

September 12, 2006

I invest because I work hard.  I feel that investing is the only way to make the most of what I’ve got and I feel that if I do it right, I will be comfortable when I choose to stop working so hard.

The way that I “do it right” is to utilize the most effective stock selection program I have ever used.  I like it because I can verify the results.  I like it because no one is “selling” me on a stock.  In fact, once I started using this program, I have been able to isolate a handful of companies, worthy of my attention, in just minutes.

The short video at the top of the home page explains how this works, quite well.  www.FocusedInvesting.com

Take a look for yourself.

Posted by FocusedInvesting at 1:15am
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Internet Investing - Easy Money?

September 10, 2006

There seems to be an expectation that if you could just find the “secret” then making money would be easy.  What’s so funny is the secret is out.  The information is available to us 24/7 on the internet and in print.  Which method will make it easy for you to make “Easy Money”?  We believe in the approach of Trust and Verify.     I know that there are tools available to make anyone who is willing a Successful Individual Investor.

I feel the message is clear; to really make big money, you have to do some of the work yourself.  Notice I said “some” of the work.  Just trusting someone else with your money may be fine for some people who have more than enough and are ok with expensive fees to let someone else do the investing selections.  Independent investing is for the naturally analytical and self-reliant among us.

If you are an engineer (if not as a profession, then as an approach to life) you know what I am talking about.   A good engineer thinks through a process starting at the goal/result and works her way back to the raw materials.  The “work” is in learning concepts, tools and the “how to” of the many different processes possible in order to select the most effective for the job at hand.  Why reinvent the wheel?  An engineer’s approach would also include an acknowledgement and inclusion of tools and machines that have already been tested.  The ultimate goal is to get the desired results, utilizing the most efficient methods. 

Picture the raw materials as all of the stock selection information available on the internet, television and in print.  The goal is to isolate the best long term investments, using the excellent criteria established by Warren Buffett.  We would want this selection machine to analyze and sort through thousands of companies (their history, their present management and their potential) so we do not have to read each company’s annual report, going back five or ten years or recall these details from memory.  We know that we have more computing power now, than ever before in history.  We also have more electronically stored data than any one of us could read in a lifetime.

The good news; a brilliant mathemetician has put together an amazing program to find the “Golden Needles” (good companies at a good price) in the “Haystack” (thousands of publicly traded stocks).  Take a look at this program now, www.FocusedInvesting.com

Make the Most of What You’ve Got…

Posted by FocusedInvesting at 12:18pm
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Internet Investing - Attitude

September 08, 2006

Get ready for the most important factor in successful investing: attitude.  What is your attitude about investing?  Can it be improved? We will explore just one attitude facet of a successful investor.

There is a lot of discussion on television and the internet about what is going on in the “Market”.  Most of it is worrisome chatter, shallow warnings and soap selling drama.  The general audience members do nothing but parrot what is heard from these sources, never taking the time to read the back story or go to the company website to find out the facts for themselves.  So then we have people we know and love, who are completely involved in the “story”, telling us that they have some bad news…Don’t listen!  Find a way to work only with facts and avoid the rollercoaster of panic and euphoria.

Detachment is one of the most powerful things we can put into practice to have a productive happy life.  Detachment means:

1. avoiding emotional involvement
      Synonyms: withdrawal
2. the act of releasing from an attachment or connection
      Synonyms: disengagement 

(This definition was provided by www.e-tutor.com )
Detachment can be done in a loving considerate way.  Silence in the face of panic is one of my favorite methods.  I get quiet so I can think.  This has great social value. 

What is the value of Detachment as a financial concept?  Being objective makes us more effective at observing what is really going on.  If you are attached to the “story” and the facts point to the fact that it is time to sell, you might hang on to a stock that is no longer serving you.  The facts and the performance are the methods of steering a good value portfolio.  Patience keeps us on the right path. 
Read everything you can on how the successful investors do it.  For a great reading list, http://www.focusedinvesting.com/investing/reading.php
You are already analytical and self reliant.  Now you need a few excellent tools to be the successful investor you want to be.
 

Posted by FocusedInvesting at 12:12am
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Investment Success

September 06, 2006

Investment success means confidence in ones selections and financial reward. As you know, investment is just one part of a healthy financial plan.  We have seen success demonstrated in Warren Buffett and many other investors who follow a value approach.  How is it the Mr. Buffett is so successful?

There are many books to read, news programs to watch, and articles to study about how Mr. Buffett does it.  You can find a short list of some of the best books on the topic at http://www.focusedinvesting.com/investing/reading.php

The simple approach of getting to know the company you think you want to invest in is a key ingredient to this kind of success.  Study, patience and persistence are nothing new to us, and are also key.  Mr. Buffett has been a successful investor for over 40 years.  It is not my goal to do it better than him or to even “copy” his stock selections.  His funds are much larger than mine and his shareholders, business model, personal lifestyle, and investment minimums are just some of the factors that would not affect the average individual investor.  So how do we use what we have learned from Mr. Buffett?

Start with the short video tutorial found at www.focusedinvesting.com

Select at least one book on the subject to read.  After you have finished the book of your choice, email your questions to smlbusowner@focusedinvesting.com  I will review your questions and post the questions and answers here at Enlightened Self Interest.

Posted by FocusedInvesting at 10:10pm
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