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    Wednesday, November 7, 2018

    Warren Buffett Value Investing Cheat Sheet - A handy check-list I compiled Investing

    Warren Buffett Value Investing Cheat Sheet - A handy check-list I compiled Investing


    Warren Buffett Value Investing Cheat Sheet - A handy check-list I compiled

    Posted: 06 Nov 2018 10:37 AM PST

    Below is a handy check-list for valuing investing the old-school Warren Buffett way. I thought you might find it useful.

    All the stats are derived from Buffett's advice over the years through shareholder letters and other sources. In my opinion, it is nearly impossible for a company to tick all of these boxes in the current market, but they are useful guidelines.

    Anything else you guys would add to the list? What other metrics / checks do you use?

    • Debt/Equity < 0.5
    • Current Ratio > 1.5 && < 2.5
    • Price/Book < 1.5
    • ROE > 8% consistent/increasing over last 10 yrs
    • ROA > 6%
    • Stable Book Value growth
    • Stable EPS growth
    • Stable Dividend growth
    • Moat
    • Interest coverage ratio (Income from operations/Interest expense) > 5X operating income
    • Inventory turnover ratio (Cost of Revenue/Inventory) > 4
    • Free-cash-flow-to-revenue ({Operating cash flow + property, plant & equipment} / Revenue) > 5%
    • P/E Ratio < 15
    • S&P rating > BB
    • Reasonable Margin of safety (DCF intrinsic value/current price)

    submitted by /u/Shanemonksobyrne
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    I Read The News So You Don't Have To - Market News (Nov. 06, 2018)

    Posted: 06 Nov 2018 09:41 AM PST

    UNITED STATES

    • The ISM Non-Manufacturing index reveals continued economic strength
    • Jobs in professional services, health, and construction grew rapidly over the last 12 months
    • New businesses are forming almost as fast as new jobs are being created
    • Worry over new antitrust rules aimed at tech companies, coupled with worries over weak iPhone sales sent Applestock down

    On the Ballot Today:

    • San Francisco will vote on taxing big companies with HQ's there to help combat homelessness.
    • North Dakota, Missouri and Oklahoma will vote on loosening cannabis laws.
    • Idaho, Nebraska, Utah and Montana will vote to expand medicaid.
    • Washington will vote on a carbon tax
    • Florida may restore voting rights to felons

    OTHER

    • Berkshire Hathaway has held over $100bn in cash for 5 straight quarter
    • Stocks exposed to the risk of higher wage costs eating into their profit margins have oddly outperformed
    • The Turkish lira continues its recovery
    • Household spending in Japan was much weaker than expected (Actual -4.5% | Expected -1.8%)
    • A report commissioned by Facebook found the site had been used to incite violence in Myanmar and helped enable human-rights abuses
    • Spotify said it would buy back $1bn of its shares over the next 29 months.
    • Under Armour says it stopped executives from expensing visits to strip clubs in February

    CHINA

    Sorry, one of my sauces got the original post removed. Better late than never?

    submitted by /u/ogordained
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    McDonald's quietly making all-time highs

    Posted: 06 Nov 2018 05:37 PM PST

    What do you all think of MCD at these levels? Made a new ATH on Monday and closed even higher today.

    Market cap is $140B right now, which for comparison is about the same as Netflix at $136B.

    submitted by /u/bigglek
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    Is it better to own actual property or REITs?

    Posted: 06 Nov 2018 07:16 PM PST

    I'm asking this question within the context of cash flow, not appreciation.

    Just to make it simple, let's pretend there are no tax advantages for owning real property/having a mortgage.

    Let's also assume you can't use leverage. (Edit: For this scenario, let's assume you can't use leverage for real property; REITs themselves can still use it, but you can't use leverage to buy REITs).

    In terms of pure cash flow (for REITs, this would be dividends), which is better to own?

    submitted by /u/friskykitty1
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    Investing/ Trading

    Posted: 07 Nov 2018 02:51 AM PST

    Have seen all these traders on instagram, most I am aware are a scam. What's the best way to start trading as a beginner, any websites/information from you guys would be really appreciated! Also is it worth even worth while trading without huge sums of money

    submitted by /u/caShwill
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    How to Trade & Invest 101

    Posted: 06 Nov 2018 05:36 PM PST

    Hi r/investing I spent the last two weeks putting together a compendium of all my knowledge about US equity investing and trading. I hope this helps those out there looking for a place to start.

    How to Trade & Invest 101

    https://docs.google.com/document/d/1w_XLwCGcEIBlE9oCdWIul-N_CbcA5AkG0zXmxmpbLpg/edit?usp=sharing

    Happy to answer any questions and I would love any feedback for how to improve it.

    submitted by /u/Svyable
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    $Amd just produced a server CPU 2.1x more powerful then Intel's best CPU. [Discussion]

    Posted: 06 Nov 2018 11:56 AM PST

    How to offset realized capital gains

    Posted: 06 Nov 2018 08:43 PM PST

    I have about $4k in realized short-term capital gains and, thanks to the recent correction, $7k in unrealized losses. What is my best move in terms of taxes? It would be a bit painful to pay capital gains taxes when I'm actually down $3k in 2018. On the other hand, I don't want to sell just to bring down my realized gains. Are there other options?

    Edit: Would there be any advantage if I brought my 2018 gains down to zero (by selling) compared to paying taxes on $4k gains in 2018 and deduct the losses in the subsequent years?

    submitted by /u/asml84
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    A first-of-its kind tax on big businesses to help the homeless has an early lead in San Francisco election.

    Posted: 06 Nov 2018 10:04 PM PST

    Future prospects of S&P500?

    Posted: 07 Nov 2018 03:42 AM PST

    I invested $2,000 into it a month ago and it's now at $1998. I'm not planning to use S&P500 as a short term investment, but as a long term one, but it is worrying me that in a month all I got out of it was losing $2.

    I'm a first-time investor so any obvious things I should know I probably have no clue about. All I know right now is that putting my savings into S&P500 was better than taking a vacation.

    submitted by /u/StrawoftheMonkey
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    difficulty understanding spread and order price

    Posted: 06 Nov 2018 11:56 PM PST

    I have difficulty understanding the spread and order in investment platform I use, FxPro. Let's say the bid price of X is 20 and ask price of X is 30. If I place sell limit or buy limit order at price of 25, isn't it logical the order would be filled immediately? I've been trading in cryptocurrency exchanges for months and it worked that way the whole time, but I just don't understand why such order takes very long time or never get filled in FxPro platform. I wonder if this happens in other trading platforms as well. What is it about? Something I don't know or something I am not aware of? I have no idea!

    Thanks, Eugene Do

    submitted by /u/eugenedo1206
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    11/6 News (and predictions) of Day

    Posted: 06 Nov 2018 06:07 AM PST

    Hi all,

    I recently joined Reddit on the advice of a best friend of mine while also (finally) opening my own trading account. I have found a lot of helpful, as well as unhelpful, content on here and I wanted to do my best to be helpful to people as well. As such, when I have time I plan on doing a daily overview of current events as well as how I see them playing out in the markets. I'm interested in working for a hedge fund or doing equity research, so naturally writing something like this would not only help on that front but also allow others to engage with me and challenge my ideas. Please note that the opinions stated here are the thoughts of just another retail investor and I am not expressly stating what you should or should not do with your portfolio. With that said, here goes nothing...

    What's Happening

    • Elections are today (so get out and vote, otherwise don't complain about the outcome)! Many see the Democrats taking control of the House and winning more gubernatorial seats with the Republicans maintaining the Senate. This result could help with Trump's infrastructure plan, which could offer a boost to companies like US Steel (NYSE:X) or Caterpillar (NYSE: CAT). I still remember when Trump won the election and US Steel saw a jump to $39.44 at one point. Regardless of who wins, markets tend to do well through Q2 of the next year, so it should be interesting to see the winners and losers. I could see construction and clean energy stocks doing well with tech giants seeing further declines, assuming regulation is pursued against them. I think financials could go either way depending on regulatory proposals put forth by the Democrats.
    • According to JPM, share buybacks by companies are on the rise. A notable example includes one by Buffet at Berkshire Hathaway (NYSE: BRK.B) of $1bn in August. They recently invested in fintech firm Paytm, an Indian company that offers a mobile payment platform. Buffet is sitting on ~$111bn in cash which to me is indicative of his not seeing any opportunities at the present. I could very well see him waiting for the next downturn (ie recession) to swoop in and make some purchases at discounted prices, as he is not one to overpay, and thus leading BRK.B to higher levels than we currently see.
    • Optimus Ride just partnered with Nvidia (NASDAQ: NVDA) for its autonomous vehicle fleet to upgrade to Level 4 (meaning little human interaction is needed in the operation of a vehicle) vehicles. Nvidia has its DRIVE platform that allows for synthetic testing, meaning that billions of miles in test drives and AI can be simulated without having to ever hit the road. I'm curious to see how the race toward autonomous vehicles turns out with Intel (NASDAQ: INTC) being in competition with Nvidia. From my research, however, it appears that Intel is more involved with hardware (chips) whereas Nvidia is more involved with software (AI and synthetic testing). Intel also recently acquired MobilEye which further pushes them ahead. Given each company has partnerships with many large automobile manufacturers, I believe that each can excel in their respective space and reap large profits from this new business in the years to come, bolstering their stock prices in the years to come once we finally see these new fleets completely rolled out.

    If you actually read through all this... thank you! Please leave feedback for me, your thoughts on what I presented, or anything else you care to share.

    submitted by /u/hbratt69
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    Ahead of elections, industrials lead US stocks higher

    Posted: 06 Nov 2018 12:39 PM PST

    What firms are known as "asset stripping" firms?

    Posted: 06 Nov 2018 10:42 PM PST

    I recently found out about asset stripping and I'm curious to find out what companies typically use this model. i read that private equity firms do this but I haven't seen much indication of that in the post 2000s era. Would these firms be low key and under the radar?

    submitted by /u/fireassassin97
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    How will the market look with Democrats taking the house?

    Posted: 06 Nov 2018 09:11 PM PST

    I wonder what the market will look starting tomorrow now that the Democrats have the house

    submitted by /u/israel1947
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    Where do you find companies at to invest in? How can you find a company thats jus starting out or is new or a few years in etc.?

    Posted: 07 Nov 2018 12:08 AM PST

    This may be a dumb question.

    submitted by /u/imperba
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    ratios and other ways to value a company

    Posted: 06 Nov 2018 03:21 PM PST

    Hey guys and gals! so i have been reading a lot about intrinsic value and value investing, and know only of P.E. ratio compared to other company's in the sector, but was wondering if there were any other ratios or anything else to look for while going over the annual report

    submitted by /u/onlyfornofap_______
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    Rental property vs ETF at a low rental ROI area

    Posted: 06 Nov 2018 04:31 AM PST

    Hi,

    I'm struggling to set my mind between investing in S&P 500, expecting a 7% average return, or buying a rental property in an area with low rental ROI.

    Let's consider the following situation:

    *4.5% max rental ROI (i.e. a $150K property rents for $560 monthly).

    *$150K to invest

    *5% average annual appreciation for same properties over the last decade or so.

    Considering the taxes in my country, I'm looking at 25% long term investment taxes and no property tax.

    Without leveraging the investment with a mortgage, I'm looking at an annual ROI of 8.5%. Now, I figure that the extra 1.5% ROI does not worth the extra hassle of being a landlord.

    If I'm taking a mortgage, I can leverage the investment and get better returns. What would be the ROI delta between property and stocks that would make you prefer buying a property over stocks?

    submitted by /u/cstocks
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    How do we find the list of stocks on S&P500 / VFIAX / Schwab 500 index / Fidelity 500 spartan index?

    Posted: 06 Nov 2018 10:44 PM PST

    How do we find the list of stocks on S&P500 / VFIAX / Schwab 500 index / Fidelity 500 spartan index?

    So basically that we can do it ourselves on some margin and no management fees.

    Thank you very much guys! If you understand what I am asking for, lol.

    submitted by /u/Griffin90
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    What’s the best way to ask a company for helpful info on upcoming catalysts and whatnot without risking insider trading?

    Posted: 06 Nov 2018 10:11 PM PST

    Question to anyone who uses Interactive Brokers

    Posted: 06 Nov 2018 12:24 PM PST

    Ok so I live in Germany and use IB for trading the US market. One thing I noticed is that I cannot buy ETFs... like at all. Options on ETFs seem to be fine but when I input, say, QQQ, Order Entry merely says: "Financial Instrument is not available for trading".

    Does anyone know of a solution?

    submitted by /u/Versart
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    Does RH refresh as fast as ToS?

    Posted: 06 Nov 2018 09:47 PM PST

    Not sure if this is the best place to ask but I've been consistently loosing profits due to commissions and might switch to RH. I was wonder from when I use to use RH the value of the stock seemed to refresh a lot slower than ToS or Active trader. If I set a limit at an exact price and it's only there for Maybe a few seconds will It sell on RH?

    submitted by /u/Whoezy
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    Real Estate Investment Trust (REIT) Ideas

    Posted: 06 Nov 2018 10:43 AM PST

    Looking at a Real Estate Investment Trust (REIT) Dividend Report and there are so many with High Dividends. Does anyone have any idea if they are going to cut there DIV, or just go out of business. One GOV yields 18.82% while managing government properties. Seems like a recession proof REIT leasing to the Government, any ideas are greatly appreciated.

    submitted by /u/whyoptions
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