Call me old-fashioned, but I believe that words matter. In the world of finance, the terms investment and speculation are often blurred. We frequently use “investment” as a catch-all to describe any outlay of money made in the hope of future profit. I’m as guilty as anyone of using it in this overly broad sense. […]
Investment vs. Speculation: Investing Defined Read More »
The more I learn about artificial intelligence (AI), the more convinced I become: this may be the most transformative innovation in human history. Learning AI as a Non-Technical Investor I don’t have a technology background. But I do believe in research and critical thinking. As an investor, I’m trying to understand the economics of AI
AI and the Future of Work Read More »
Lost in the flurry of headlines regarding the conflict between the White House and the Federal Reserve is the wildcard for lowering interest rates more broadly – inflation expectations. What Is Inflation—And Why Does It Matter? Inflation is a persistent increase in consumer prices—or, put another way, a decrease in the purchasing power of money.
Inflation Expectations and Interest Rates: What Investors Should Understand Read More »
In a previous post, I discussed how individual investors have a significant advantage over professional money managers: they don’t face the pressure of outside capital being redeemed. This allows them to adopt a long-term investment strategy, regardless of short-term market fluctuations. In contrast, professional fund managers must consider short-term performance to retain investors and assets
The Benefits of Small Capital: Why Individual Investors Have the Upper Hand Read More »
In an article in The Wall Street Journal titled You’re More Like Warren Buffett Than You Think, financial journalist Spencer Jakab highlighted what I believe to be one of Warren Buffett’s most important, and certainly most overlooked, competitive advantages: Buffett has permanent capital with which to invest. This is not the case for managers of
The Edge of Individual Investors – Permanent Capital Read More »
If I had to choose a single metric to track the health of a business, that metric would be return on invested capital (ROIC). This metric helps answer what I believe is the single most important question in business: can the business earn a fair return on the financial capital that is placed in it?
What is the Best Financial Metric? Read More »
Introduction Real estate is an “other people’s money” (OPM) business, and commercial real estate investors often spend a significant amount of time raising capital for individual deals. This capital comes in two forms: debt and equity. In this post, we will look at how commercial real estate investors raise both equity and debt capital. Equity
Introduction to Commercial Real Estate Part 5: Financing the Deal Read More »
Introduction Due diligence is one of, if not the, most important periods in the real estate investment process. It is during the due diligence phase that the investor looks for any factors which can change the financial merits of the purchase. These factors may prompt the investor to either renegotiate terms with the seller or
Introduction to Commercial Real Estate Part 4: Due Diligence Read More »
I don’t frequently do book reviews, but occasionally a book is published that is so closely aligned with the Fundamental Investing Institute’s mission of educating and empowering entrepreneurs and individual investors that I would be remiss not to comment on it. Codie Sanchez’s book, Main Street Millionaire: How to Make Extraordinary Wealth Buying Ordinary Businesses
Review of Codie Sanchez’s Main Street Millionaire Read More »
Introduction What most distinguishes an investment asset from a speculative asset is the comparison of price vs. appraised value. To an investor, the comparison of price and value is the most important consideration. It is only fitting, then, that I devote a post in this series to the valuation of commercial property. Before I go
Introduction to Commercial Real Estate Investing Part 3: Valuing Commercial Property Read More »
