Previous Articles

This Year's Features

By Date    |    A-Z Listing    |    By Topic

 

09/17/03 Pro Forma Deception
In the past five or six years, investors have been confronted with the rise of a peculiar and sometimes deceptive practice of management’s endorsement of so-called “pro forma” financial statements and earnings. These adjusted numbers have important implications for all parties involved – shareholders, bond holders, vendors, and employees. Before you pick up another annual report, it is important to understand the potential abuses and benefits of the non-GAAP financial figures frequently found in annual reports and press releases.

09/07/03 The Perils of the Commodity Business
One of the sure-fire ways to lose your financial shirt is to invest in a commodity type business that competes primarily on the basis of price.  Discover traits pf commodity-type businesses and exceptions to this rule in order to save yourself potentially large losses.

08/31/03 Price is Paramount
Finding a company with excellent financials and brilliant management is not enough to guarantee your investing success. Although these attributes are vitally important in selecting stocks for your portfolio, the price you pay is the ultimate determinant of the rate of return earned by any asset you purchase. Investors often fail to recognize or acknowledge this simple truth. This attitude leads to ordinarily sensible people paying ludicrous prices that almost ensure a sub-par return.

08/01/03 The 3 Types of Investment Risk
Every investment decision you will ever make faces the possibility of three very different types of risk - business risk, valuation risk, and sale risk.  The key to successful investing lies in minimizing each of these risks.

07/21/03 The Problem with Asset Intensive Businesses
In the early part of the 20th century, investors favored asset intensive ("smokestack") industries.  History has proven these are not the best enterprises to own indefinitely.  Find out why and how to gauge the asset intensity of a business using the ROA ratio.

07/10/03 Index Funds - The Dumb Money Almost Always Wins
After you've been around the Wall Street block once or twice, you may start to wonder why the numerous brilliant, well-paid money managers with entire research departments at their disposal are unable to beat the Dow Jones Industrial Average.  Thanks to the invention of index funds, you can own a piece of the DJIA itself.

06/17/03 Capital Gains Tax Holding Periods
The total capital gains tax you pay is largely determined by the amount of time you held an investment. Use this resource to discover the effective capital gains rate for your investments.

05/19/03 Dividend Tax - The Political Debate
Democrats and Republicans have plenty to debate as President Bush’s much-hyped tax cut makes its way through Congress. One of the main points of disagreement is the so-called dividend tax. Republicans say it’s an instance of abusive government doling out double taxation. Democrats say eliminating the tax would give an unfair advantage to the rich.  Take a closer look at each side's arguments and a possible compromise.

04/27/03 Determining Dividend Payout
How should a company's Board of Directors determine the amount of dividends paid to shareholders?  This article discusses factors to consider when evaluating the effectiveness and prudence of a company's dividend policy.

04/15/03 The Wash Sale Rule
Investors sometimes try to lower their tax bill through fancy footwork.  One of the ways the IRS stops this is through the Wash Sale rule.  Walk through a real life example of an investment trade subject to the Wash Sale rule in this article.

03/22/03 The Board of Directors
Mention “board of directors" to the average investor, and they will likely picture nicely dressed men and women standing around a mahogany table. Ask them what those board members do, and few will be able to give you an answer.  This article explains the structure, responsibilities and compensation of corporate boards.

02/27/03 The Basics of Shorting Stock
Arbitragers, speculators and many individual investors engage in a practice known as shorting stock.  These "shorts" make money when the price of the stock they are shorting goes down.  This article explains the risks and mechanics of shorting stock in your personal portfolio.

02/11/03 Starbucks Franchise Value
In this article, we are going to examine the Starbucks franchise and discuss the reasons the Seattle coffee company is considered an excellent business.  It is my hope that by understanding the characteristics we uncover, you will be able to spot other companies for possible inclusion in your own portfolio.

01/29/03 How to Think About Share Price
Did you know that a $125 stock may be cheaper than a $10 stock? Learn more about the concept of price per share to relative earnings, and open up a world of new possibilities for your portfolio.

01/15/03 Finding Investment Ideas for Your Portfolio
Many investors are interested in selecting individual common stocks for their portfolio, but aren't sure where to begin their search.  These four tips will help you find hundreds of investment ideas in your own backyard.

01/03/03 10 Financial Resolutions for the New Year
Ready to change your financial life but don't know how? This practical guide includes ten things you can do to take control of your finances and begin building wealth in the new year.

Articles from Past Years

2002 - Read articles, interviews, and features from 2002
2001 - Read articles, interviews, and features from 2001