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Graham’s Criteria for the Defensive Investor

Just saw some articles from Stingy Investor ( talking about Graham's stock selection criteria for the defensive investor. Benjamin Graham's Criteria for the Defensive Investor ——————————————————- P/E Ratio less than 15. P/Book Ratio less than 1.5. Book Value over 0. Current Ratio over 2. Earnings growth of 33% over 10 years. Uninterrupted dividends over 20 … Continue reading

Earnings Yield and Return on Capital

I picked up a copy of Joel Greenblatt's "The Little Book that Beats the Market" today. In it, it talks about finding cheap companies (high earnings yield) and good companies (high return on capital). The first time I saw a discussion on the importance of high earnings yield, is in Mary Buffett's Buffettology book (1st … Continue reading

Determining the Intrinsic Value of a Business

"How much is this business worth?" is a critical question that one needs to ask, after answering Is this a good business? Is there good management? Typical techniques used to produce that answer, have been a combination of the following: Discounted Cash Flow (DCF), with varying degress of sophistication, Dividend Discount Model, Gordon Growth Model, … Continue reading

Determining the Optimal Equity Portfolio aka Modeling a Basket of Credit Default Swaps

Say you have picked out a couple of companies. Done your detailed research, estimated their potential gains, estimated the time horizons in which the catalysts would occur, and finally decided that they are good buys. So how exactly should your optimal portfolio look like? Do you pick the top 8? the top 10? or maybe … Continue reading

Difference between Stock Splits and Stock Dividends

They are essentially the same. In both cases, each shareholder receives a certain number of new shares free of charge, whereby the stock price is reduced accordingly. The total shareholders' equity remains the same. Cash remains the same. In the case of a stock split, each old share is split into a number of new … Continue reading

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