The great thing about being a trader is that we can be very light on our feet. You don’t have to worry about getting out of a position. You are not married to stocks, like value investors. Being opportunistic and attentive to the vagaries of the market… Read More

Investors may feel like they have nowhere to turn during times like these. Equity investors have seen a -35% return in the S&P 500 during the past 10 years, making it known as “The Lost Decade.” Meanwhile, those who turn to bonds are likely to find themselves sorely disappointed — the 10-year T-bill currently yields a measly 3.02%. So what’s an investor to do? Well, there is a security that provides diversification with bond-like regular income along with a shot at capital gains. Trouble is, most people haven’t heard of… Read More

Investors may feel like they have nowhere to turn during times like these. Equity investors have seen a -35% return in the S&P 500 during the past 10 years, making it known as “The Lost Decade.” Meanwhile, those who turn to bonds are likely to find themselves sorely disappointed — the 10-year T-bill currently yields a measly 3.02%. So what’s an investor to do? Well, there is a security that provides diversification with bond-like regular income along with a shot at capital gains. Trouble is, most people haven’t heard of it. And if they have, investors often shy away from them because they seem too complicated. It’s a real shame, because these readily available securities often make terrific investments for a portfolio. The security in question is known as “preferred stock.” Investors should think of preferreds as stock-bond hybrids, because they share characteristics of both. Let’s walk through how a preferred issuance is characterized and how investors can score juicy and stable returns. Hospital REIT Ashford Hospitality Trust (NYSE: AHT) issued eight million… Read More

During the past few months, experts have been slowly ratcheting down their global economic growth forecasts. A robust first half rebound is likely to be followed by a second half slowdown. Where the global economy heads from there is a crucial question for… Read More

Heading into a long holiday weekend, company-specific news may be light. But Washington is gearing up to release a slew of important data. Here’s a look at three economic items to watch: Home Prices look for a Floor Here’s a sobering stat: As of the first quarter of 2010, average home prices across the United States are at levels similar to what they were in the spring of 2003. They rose sharply in the middle of the decade, but have given back all of those gains during the past three years. On Tuesday,… Read More

Heading into a long holiday weekend, company-specific news may be light. But Washington is gearing up to release a slew of important data. Here’s a look at three economic items to watch: Home Prices look for a Floor Here’s a sobering stat: As of the first quarter of 2010, average home prices across the United States are at levels similar to what they were in the spring of 2003. They rose sharply in the middle of the decade, but have given back all of those gains during the past three years. On Tuesday, we’ll get the latest reading on housing prices from the S&P Case Shiller Home Price Index. So many potential home buyers are sitting on the sidelines waiting to see when housing prices will turn up. They know that prices are cheap, they just don’t want to see a newly acquired asset become even cheaper. But an upturn in housing prices could be a big motivator to get in the game, and trigger a long-awaited rebound in demand. Analysts at Case Shiller noted in their last report that “housing prices rebounded from crisis lows, but recently have… Read More

One thing was abundantly clear in the most recent earnings season: Quarterly results were often terrific as analysts had apparently underestimated the earnings strength of a wide range of companies in a wide swath of industries. And in… Read More

As the second quarter winds down, investors are shifting their sights to macro themes. We’re about to get a better sense of whether the economy is building steam, or stalling out. Here’s a look at three economic items to watch this week: Housing: New vs. Used On Tuesday, we’ll get the latest reading on sales of existing homes for the month of May. A day later, sales of new homes will be in the spotlight. Economists think existing sales rose +5% sequentially, thanks to tax credits (that… Read More

As the second quarter winds down, investors are shifting their sights to macro themes. We’re about to get a better sense of whether the economy is building steam, or stalling out. Here’s a look at three economic items to watch this week: Housing: New vs. Used On Tuesday, we’ll get the latest reading on sales of existing homes for the month of May. A day later, sales of new homes will be in the spotlight. Economists think existing sales rose +5% sequentially, thanks to tax credits (that have since expired). But new home sales likely fell sharply, according to a consensus of economists’ forecasts. The ratio of existing homes for sale compared with the number of new homes has never been larger. The glut of unsold existing homes on the market needs to be whittled down before more new homes get built. Of these two data points, the existing homes figure is the one to track. If the number shows a surprising dip in the inventory of existing homes, then home builders may start to identify the time… Read More

Put that cork back in the champagne bottle. As the dust has settled, it’s increasingly clear that China’s bold actions this weekend regarding its currency may be less bold than it seems. Clearly, the Chinese yuan will get stronger and the U.S. dollar will get weaker, but it will take several years — or longer — for any real positive benefits to be felt. Nevertheless, you can identify the long-term winners and losers from a stronger Chinese currency. Watching Paint Dry The Chinese government announced over the weekend… Read More

Put that cork back in the champagne bottle. As the dust has settled, it’s increasingly clear that China’s bold actions this weekend regarding its currency may be less bold than it seems. Clearly, the Chinese yuan will get stronger and the U.S. dollar will get weaker, but it will take several years — or longer — for any real positive benefits to be felt. Nevertheless, you can identify the long-term winners and losers from a stronger Chinese currency. Watching Paint Dry The Chinese government announced over the weekend that it would loosen the fixed rate at which dollars and the yuan can be exchanged, responding to increasing pressure from lawmakers in the United States and elsewhere. That led to a quick +0.4% gain in Monday trading for the yuan. And that’s all you should expect for the near-term. From time to time, the Chinese government will slightly loosen the band further, and the currency will make another quick +0.4% to +0.5% move. But we may not see more than a handful of those moves each year. Translation: it may be several years before the yuan gains +10% from… Read More

Today I’d like to introduce you to my friend Mike. Mike is a real person and that is, in fact, his real name. He and I met in college and have been close friends since. He’s extremely intelligent, a partner in a major law firm, and he has, to my… Read More

First-quarter earnings season is a distant memory, and we’re still six weeks away from the next torrent of earnings reports. To fill that vacuum many investors will be focusing on economic data points that will be released… Read More

Warren Buffett seemed to take it on the chin last week. In fact, he’s been hammered for a couple of months now. First came the annual Berkshire Hathaway (NYSE: BRK-B) shareholders meeting, the annual Woodstock for Capitalists and Buffett love fest held each May,… Read More