August 26, 2010

Bottom Line: UNCERTAINTY

There is an incredible amount of uncertainty in the markets right now.  Uncertainty about future fiscal policy, monetary policy, regulation, and taxes.  Uncertainty about GDP growth, revenue/earnings growth, housing, jobs, and deflation.

In light of all this uncertainty, we urge you to be extremely CAUTIOUS and CONSERVATIVE with your investments right now.
  • Keep some cash on the sidelines until there is more certainty.  There is a lot of economic data coming out in the next week or so.  This is sure to create a lot of volatility in the markets.
  • Look for high yield stocks that are selling for cheap.  Companies with strong dividends will perform better in this environment (and pay you interest on your money in the meantime).
  • Invest in gold.  You can do this by either buying shares of the SPDR Gold Trust ETF (Symbol: GLD) or by buying shares of a strong miner.  The GLD option would be the most conservative choice. 
  • Minimize bond holdings in your portfolio.  Bonds yields are absurdly low.  IBM recently sold $1.5 billion of 3 year bonds with 1% interest.  That makes no sense!  These people are getting paid little to nothing to hold these bonds, which do have a certain amount of risk.  This purchase is only sensible if you think bonds will keep rallying.  This may be possible short-term, but the rally will stop sooner or later. 

July 30, 2010

Welcome

Welcome to Investing $marts!  We've created this site because we believe that we have an uncommon approach to investing that could prove valuable to you and your bottom line.  Our team is comprised of students from top b-schools across the US.

We are excited to offer you a unique perspective on the markets.  If our insights are helpful, please let your family and friends know.  If they aren't, we'd appreciate if you kept it to yourself.

Thanks for visiting!  We look forward to hearing your feedback.