In the past couple of weeks, I have made three recent purchases. One is obvious, the other is an above-average company trading at 9x earnings that recently traded at 20x earnings and is recently down, and another is a dominant blue-chip stock that currently yields over 4.5%.
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Retirement planning is one of those tricky subjects that leads to millions of finance articles and $1,000 seminars dedicated to talking about (preying upon?) the insecurities of individuals as they enter an age in which they can’t rely on their labor anymore and must rely on a combination of Social Security, pensions, and ownership interests to get the pills paid.
To be honest, the real formula for retirement is this: “You can safely retire once you can safely generate 125% of the amount of money that you project you will spend in a given year.” The extra 25% difference accounts for unexpected expenses that show up and give you a nice margin of safety to reinvest dividends or whatever it may be so that you can make sure that you spend your later years skating on the thick part of the ice (after all, once you enter thin ice territory, … Read the rest of this article!
As the love of money has been, in all ages, one of the passions that have given great disturbance to the tranquillity of the world, there is no topick more copiously treated by the ancient moralists than the folly of devoting the heart to the accumulation of riches. They who are acquainted with these authors need not be told how riches excite pity, contempt, or reproach, whenever they are mentioned; with what numbers of examples the danger of large possessions is illustrated; and how all the powers of reason and eloquence have been exhausted in endeavours to eradicate a desire, which seems to have intrenched itself too strongly in the mind to be driven out, and which, perhaps, had not lost its power, even over those who declaimed against it, but would have broken out in the poet or the sage, if it had been excited by opportunity, and invigorated … Read the rest of this article!
The significance of an initial public offering is that stocks become openly traded on some type of exchange/counter and, in this day and age, can be purchased online in an impersonal manner by any investor rather than on some privately negotiated terms that involves communication either directly or through a broker with a person who owns the stock. That’s it.
If anything, an initial public offering is a sign that those who bought shares on the private side now have an eye towards selling their stock and want to open the bidding up to the entire world of investors rather than the narrow subset of investors that deliberately contact the private shareholders.
It follows, then, that the “perfect” IPO, in terms of fairness to public buyers and the formerly private sellers, would be one in which the immediate first day’s trading was 0% or arguably something that mimicked the relevant … Read the rest of this article!