Investing Strategies - Joshua Kennon

Investing vs. Speculating

May 14, 2012 By Joshua Kennon 2 Comments

The Original 1949 Intelligent Investor by Benjamin Graham Republish

It isn't uncommon for me to receive messages from readers who talk about how they are now investing. Most of these are cause for celebration; exciting reminders that people can take control of their own financial future by harnessing the power of compounding so they can focus on more important things in life than money. A small percentage, though, concern me. These people are those who think they are investing, sometimes they think they are even value investors, but they are really … [Read more...]

Filed Under: Portfolio Management, Value Investing

It Is So Easy To Get Rich If You Have Enough Time

April 17, 2012 By Joshua Kennon 3 Comments

General Electric Annual Report to Stockholders

This afternoon, I spent my time sprawled out on the floor of my home study, going through annual reports of the companies that make up the stocks held in the so-called KRIP plan I manage. This portfolio, which is one of the only ones I discuss on the site, is the "stupid insurance" I setup as a teenager, and to which I still contribute each year. Held in retirement plans, trusts, and other tax-advantaged structures, it is the backup to the backup to the backup. It was created so that I … [Read more...]

Filed Under: My Businesses, Portfolio Management Tagged With: blue chip stocks, KRIP Plan, retirement investing

Investing Advice from Charlie Munger

December 11, 2011 By Joshua Kennon Leave a Comment

Charlie Munger at the Berkshire Hathaway Shareholder Meeting

Here are some words of wisdom I came across about portfolio management and building wealth from billionaire Charlie Munger. We've really made the money out of high-quality businesses. In some cases, we bought the whole business. And in some cases, we just bought a big block of stock. But when you analyze what happened, the big money's been made in the high quality businesses. And most of the other people who've made a lot of money have done so in high-quality businesses. Over the … [Read more...]

Filed Under: Portfolio Management

When It Comes to Portfolio Management, Your Investments Should Not Be Protean

December 11, 2011 By Joshua Kennon Leave a Comment

I do not believe your investments should be protean. If you have chosen an asset well, meaning the asset continues to churn out constant or ever-increasing sums of surplus cash net of taxes and inflation, and you paid a reasonable price for ownership, the best thing you can possibly do for the long-run is sit on your metaphorical hands, grow richer with each passing year, and figure out intelligent things to do with the dividends, interest income, and rents you accumulate. This is the … [Read more...]

Filed Under: Portfolio Management

The Two Questions An Investor Should Ask Themselves Before Investing Money

September 29, 2011 By Joshua Kennon 2 Comments

Questions for Investors and Their Investment Portfolio - Image © Jupiterimages/Photos.com/Thinkstock

Before you invest a single penny of your money into a potential stock, bond, project, or other asset, there are two questions you should ask yourself. These two questions could have saved a lot of investors from asset bubbles and bankruptcy court. #1 - Does the Investment Offer an Adequate Rate of Return All Things Considered? When you invest your money, what you are really after is to increase the purchasing power your family has. You aren't interested in dollars or yen, pound sterling or … [Read more...]

Filed Under: Portfolio Management

You Can Almost Always Tell Which Stocks I’m Researching and Valuing By What Is In My Home Study

August 2, 2011 By Joshua Kennon Leave a Comment

You can almost always tell what stocks I'm researching at any given time by whatever is on my desk in the home study (not my desks at either office - I tend to read early in the morning and late at night so the paperwork and research notes inevitably pile up there). This week, it's the liquor companies such as France's Pernod Ricard, Great Britain's Diageo, and the United States' Brown-Forman, if you couldn't tell by the picture. It's a weird quirk but it helps me think of a stock as a … [Read more...]

Filed Under: My Day In Pictures, Portfolio Management

A Good Business Is Not Always a Good Stock – A Case Study of Diageo

July 31, 2011 By Joshua Kennon 8 Comments

From time to time, I've discussed Diageo, plc, the British alcohol giant that owns a portfolio of brands including Smirnoff, Johnnie Walker, Crown Royal, Captain Morgan, José Cuervo, Guinness, Tanqueray, Baileys, Ciroc, Ketel One, Bushmills, Buchanan's, Windsor Premier, and J&B. It's a good bet that Diageo has products in every bar in the United States, from the local watering hole in blue collar working towns to high-end exclusive clubs in the cultural meccas of New York and Los … [Read more...]

Filed Under: Case Studies & Profiles, Value Investing

The Inevitables Stock Market Index

July 29, 2011 By Joshua Kennon 1 Comment

I grew curious about what it would take to construct an index of common stocks that would allow an investor to own a vast majority of the name brand products in any discount retail store, grocery store, convenience store, and neighborhood pharmacy. My goal was to build a theoretical portfolio that would provide the owner the satisfaction of knowing that he or she would be generating profit from the underlying companies almost every time someone checked out at a cash register almost anywhere in … [Read more...]

Filed Under: Dividends, Investing Strategies

Stocks vs Bonds vs Gold Returns for the Past 200 Years

July 26, 2011 By Joshua Kennon 6 Comments

I write a lot about investing in stock and investing in bonds over at Investing for Beginners at About.com, a division of The New York Times. There is a reason I tend to be far more favorable to equity investments (stocks) than fixed income investments (bonds) when it comes to long-term investing and why much of my content is focused on the stock market. History has shown that owning businesses - which all a share of stock is; a piece of ownership in a business - generates the best … [Read more...]

Filed Under: Bonds, Economics, Gold and Gold Investing, Portfolio Management, Stocks

My Consumer Staples Obsession Reached Its Zenith Tonight … I Called Aaron and Had Him Pick Me Up to Go Discuss the Companies at Walmart Around 1 A.M.

July 22, 2011 By Joshua Kennon 2 Comments

My obsession with valuing all of the consumer staple companies continues. It is 1:11 a.m. and I called Aaron, who was driving back home from visiting his parents, and had him pick me up to take a trip to a local Walmart. I wanted to actually look at many of the product offerings of firms like Henkel, Rickitt Benckiser, Procter & Gamble, Colgate-Palmolive, Clorox, and the others. Even though I think many of the companies are fully valued or, in some cases, overvalued right now, they sit … [Read more...]

Filed Under: My Day In Pictures, Stocks, Value Investing