by KenFaulkenberry | Jul 19, 2014 | Value
Graham urged shareholders to take an active role in being owners of the company. He thought management with good results should be rewarded, and management with poor results should be questioned and challenged.
He was particularly adamant about shareholders demanding a fair portion of their earnings returned in dividends. This is because much of the time companies squander past earnings. Just because management does a good job with current operations doesn’t mean they know the best use of excess company capital.
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by KenFaulkenberry | Jul 12, 2014 | Value
The margin of safety for an investment is the difference between the real or fundamental value and the price you pay. The goal of the value investor is pay less (hopefully, much less) than the real value. Ben Graham called margin of safety “the secret of sound investment” and “the central concept of investment”. He also devoted a whole chapter to the concept and, I am confident, placed it last because it is the most important.
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by KenFaulkenberry | May 3, 2014 | Value
In value investing, one of the most important and difficult aspects of stock selection is determining whether you have found a real value investment or a value trap. The father of value investing, Benjamin Graham, spent a considerable amount of time trying to differentiate between true value investments and value traps.
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by KenFaulkenberry | Mar 2, 2014 | Value
Investment decisions should be valuation-based because the price you pay is the biggest determinant of your long term return on investment. All investment decisions are based on probability because no one has the ability to accurately forecast the future. Your best means of increasing the probability of higher than average returns is to make valuation-based investment decisions in your asset allocation and individual investments.
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by KenFaulkenberry | Jan 19, 2014 | Risk
Value investing is about purchasing investment assets at prices that put the odds of above average returns heavily in your favor. Excepting an investment that is going to go bust, almost any investment can be profitable if purchased at a low enough price.
The key to successful value investing is buying assets when the perceived risk is greater than the real risk. It’s equally important to avoid assets when the perceived risk is less that the real risk.
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As founder of the Arbor Investment Planner my passion is to educate and empower the individual investors to manage their own investment portfolio.
The Arbor Investment Planner is a value investment portfolio management guide for those individual investors who choose to manage their own money. I focus on ideas and concepts important to the self directed investor; but put special emphasis on risk management, value investing strategies, and proper asset allocation and diversification.
- Ken Faulkenberry