According to the Spectrem Group, a wealth research firm located in Lake Forest, Illinois, there were 400,000 new millionaires in the United States at the end of 2016. That’s right, 400,000! And their numbers keep growing year after year! Wouldn’t it be nice to be included in that statistic one day? If your answer is “yes” then you’ve got to have a plan to achieve that dream.
Regardless of what you may have been told or what you may believe, investing in the stock market is still one of the most effective ways for most people to get rich and best of all, a high IQ isn’t needed to do so. You simply need to know how to invest the right way since most people invest the wrong way.
Legendary investor Peter Lynch, perhaps best known for achieving 29% annual returns during his 13-year tenure with the Magellan Fund stated the following, “Twenty years in this business convinces me that any normal person using the customary three percent of the brain can pick stocks just as well, if not better, than the average Wall Street expert.” In an article written by Al Neuharth in USA Today in March of 2013 he stated, “Most of us hope to get richer as life goes on. All of us should realize that the surest way to do so is by smart and regular investments in the stock market.”
You Can Invest Like a Stock Market Pro reveals to you the tried-and-true, principles and strategies used by some of the world’s best and most successful stock market pros to build wealth. The best news is that you can begin using those same powerful principles and strategies to put you on the path to financial security that you may have thought was unobtainable until now.
With this book you will learn how to:
- Start investing with very little money.
- Locate additional money to fund your investment program.
- Identify the five characteristics of wealth generating, worry-free businesses.
- Use the extraordinary power of compounding to help grow your wealth.
- Pick stocks like the pros using a powerful eight-step stress test.
- Think and react like a stock market pro in good markets and bad markets.
- Determine the right price to pay for a stock share prior to its purchase.
- Use tax advantage accounts to accelerate your building of wealth.
- Minimize risks while investing for maximum profits.
- Construct a worry-free portfolio that lets you sleep well at night.
- Avoid industries and sectors that are too risky for investment purposes.
- Use stock screeners to help locate those hard-to-find hidden gems.
- Consistently beat the market over the long-term.
- Identify and locate good financial planners when needed.
- Use free, powerful tools of the trade to gain your investor’s edge.
You will learn where and how the author is investing his own money in his personal portfolios along with their up-to-date performance and much, much more exciting information to put you on a path to building wealth. Are you ready to put the odds in your favor for obtaining the wealth and financial freedom that most American families dream about, yet most of them fail to achieve? If that’s your desire, this book is your road map to achieving those extraordinary returns that build wealth over the long-term. Let’s begin!
|Publisher:||Trilogy Publishing Group|
|Product dimensions:||6.00(w) x 9.00(h) x 0.48(d)|
About the Author
He is a graduate of York Technical College with Honors. He has also extensively studied courses in Business Management while attending the institution and has earned numerous college credits in the process. He also earned an Undergraduate Certificate in Criminal Justice with Honors from Ashworth College.
He served four years in the United States Marine Corps where he was meritoriously promoted twice and received an Honorable Discharge and Good Conduct Award. He served during Operation Desert Storm and received the National Defense Service Medal as a result. He was born and resides in the beautiful state of South Carolina with his family.
Read an Excerpt
YES! YOU CAN INVEST LIKE A PRO!
You may be wondering if you are capable of learning the information presented in this book. Most people think it takes great intelligence to learn how to successfully invest in stocks, but, fortunately, that isn't entirely true. If it were, I certainly wouldn't have been qualified to write this book, nor would I have achieved the amazing returns that I have. I consider myself a person of average intelligence, but I must admit I'm very pleased with the success I have enjoyed through stock investing since 2008. So, when I say, "Yes! You can invest like a stock market pro!" I really mean it. It really isn't that difficult, though it will take some time and dedication to the process.
Most successful investors will tell us to keep things simple when it comes to investing and to stay away from investment systems, principles and strategies that are too complex because they usually don't work, only work for a short time, or only make the inventors or creators that sell them very rich. The world's best pros are able to consistently obtain market-beating returns, and are able to do so over the long term. What's even more amazing is those pros are convinced the small or individual investor can do the same; in other words, these great investors believe the small or individual investor can invest like a stock market pro, just like I do. Although there are many pundits that say it is impossible to beat the market, Sir John Templeton, Peter Lynch, Jim Slater and numerous other great investors have said you and I can beat the stock market over the long term — and to me, that's what counts. Even the amazing and energetic Jim Cramer, of the very popular show Mad Money, believes that individual investors can beat the market by holding between five and 10 stocks in their portfolios and actively managing those positions. Yes, the intriguing Jim Cramer believes we must actively manage our stocks and not buy-and-forget them, and I fully agree. If you can consistently beat the market long term, you definitely are investing like a pro!
The principles and strategies included within this book are easy to learn and simple to use, and I can say they work without a doubt. As a matter of fact, they have worked for some of the world's best and most successful investment pros and are still working for many of them because are the ones who have created and perfected these techniques. I simply have compiled and organized their information in an easy-to-read format. Since this book contains some elements of several popular stock investment styles or strategies that exist, I simply call it "worry-free investing" to distinguish it from other systems or programs; thus, I will on numerous occasions refer to you or myself as worry-free investors, because if you are going to invest like the pros do, you have no business worrying when it comes to your portfolio.
"Twenty years in this business convinces me that any normal person using the customary 3% of the brain can pick stocks just as well, if not better, than the average Wall Street expert." — Peter LynchCHAPTER 2
CAN YOU AFFORD NOT TO INVEST?
All too often, people fail to invest in their future because they believe they simply cannot afford to invest, don't have the time to invest, or that investing is just too difficult. This way of thinking begs a few questions: Can you afford to be old and broke? Do you want to struggle financially all of your life? Do you want to depend on someone else, yet, still barely get by? Well, my response to every question is, "I don't!"
Here in the United States, one of the richest nations in the world, it's common to see Americans still working well past their retirement age — and not because they want to, but because they must. We see the elderly working in the local grocery store or at Wal-Mart. These same people have spent their lives working and paying taxes, yet, many now have to wrestle with serious choices, such as whether to pay their electric bill instead of buying an essential medication they need to live a more productive life. I personally have visited the homes of many of the elderly, and I have a great insight into the daily financial struggles and hardships they face.
Some may wonder, "Why worry about the future when tomorrow is not promised?" But in my opinion, not knowing what the future holds is a perfect reason to be prepared. Do you think most of the elderly people still working well past their retirement age thought they would have to do so? You see, you can no longer use the excuse of not having the money or time to invest, or that it's too hard to invest. Can you really afford not to invest in your future?
"Government is not the answer. The answer lies in us. We alone are responsible for our ultimate financial welfare." — Robert G. AllenCHAPTER 3
INVESTING THE WORRY-FREE WAY
Before I tell you what worry-free investing is, let me tell you what it isn't. Worry-free investing is not a "get-rich-quick" investing program. I repeat: Worry-free investing is not a "get-rich-quick" investing program! It's a program that instructs investors how to use the principles and strategies of some of the world's best and most successful stock market pros to buy and sell stocks that enable the investor to build wealth in an intelligent manner over the long term. Some individuals may think worry-free investing means "risk-free," but that's not the case. Worry-free investing, like most other investment plans or programs, also carries risks. It would be nice if it didn't, but I'm afraid that it's not possible to invest in so-called "risk-free" stocks.
If I didn't call this program "worry-free investing," I would probably call it "peace-of-mind investing." The peace-of-mind comes from knowing when I have created a portfolio, its creation is based on the tried-and-true principles and strategies used by the best minds in the investment business. Make no mistake about it, there will be some volatility to even a worry-free portfolio, and some picks will result in capital losses; but in the end, there should be a lot more winners than losers — and with those winners, the sky is the limit.
So, what exactly is worry-free investing? It's nothing new. Benjamin Graham, regarded by many to be the father of value investing, stressed the importance of having a margin of safety with every stock that is purchased. The same is true with worry-free investing. Jim Slater believes some of the best returns can be realized by investing in small- to medium-size companies that have shown strong historical growth in their earnings, and worry-free investing stresses the same. Warren Buffett would probably tell us to only invest in businesses that have a durable competitive advantage. Guess what? So, does worry-free investing. John Bogle, the father of the index fund, would probably tell us not to waste our time trying to time the stock market. Sounds a bit like worry-free investing to me. John Bogle has been an investor for more than sixty years! Peter Lynch, perhaps best known for achieving 29% annual returns during his 13-year tenure with the Magellan Fund, would probably tell us to only invest in businesses that we understand, to have patience and to not get scared out of the stock market if we truly want to make some serious money. That definitely sounds like worry-free investing to me. You see, worry-free investing is the incorporation of some of the best and most effective stock-investing strategies and principles of the world's most successful investment pros into one very effective investment program — though it is much, much more than that.
It's also about utilizing various investment tools, such as the Caps rating system developed by the Motley Fool, that have been created simply for the purpose of helping you and me become better investors. Then there are websites such as Gurufocus.com, Insidermonkey.com and Fool.com that I also consider to be tools, as their main goal is to educate investors. Worry-free investing also is about thinking outside the box, and using what works for you and discarding what doesn't. Finally, worry-free investing is about having a specific mindset or temperament. This book provides you with the principles and strategies that I have used to help me develop the temperament that is needed to succeed as an investor. It's something that either you have, or you must develop; and if you find that you already have the temperament, it sure wouldn't hurt to improve or strengthen it.
"Investing should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas." — Paul SamuelsonCHAPTER 4
CHARACTERISTICS OF A WORRY-FREE BUSINESS
To invest like a stock market pro — i.e., a worry-free investor — you must see yourself as a business owner. Think about it: whenever you and I buy a stock, we actually are buying partial ownership in a business. So, our goal should be to locate and purchase the best businesses we can find. There are specific characteristics a worry-free business should possess that tell us it's capable of creating wealth for the investor over the long term.
A worry-free business should be fairly easy to understand. According to Peter Lynch, "If you're prepared to invest in a company, then you ought to be able to explain why — in simple language that a fifth-grader could understand, and quickly enough so that the fifth-grader won't get bored." Time and time again, research has shown complex investments tend to be poor investment choices.
A worry-free business needs strong brand appeal to give it a sustainable competitive advantage. (Just think of our mindset: many of us are particular about the brands we choose when purchasing certain items.) During a trip to the local mall with my wife and granddaughters a few years back, I remember walking into a teen clothing store and being amazed to see it was packed with teenagers and parents eager to spend their money. That event alone was enough to convince me the business definitely had strong brand appeal.
It is important for worry-free businesses to be investor-friendly and investor-oriented. We only want to own the stocks of businesses in which the managers, first and foremost, look out for the interests of its owners — because, as shareholders, that includes you and me. Just think of all the financial scandals we've seen wipe out the wealth their investors, like the Bernie Madoff Ponzi scheme, and the Enron and WorldCom scandals, to name a few. Going to sleep a millionaire and waking up broke has got to make for a bad day. So, we need to be certain the managers running the businesses in which we invest are sharp, trustworthy and investor-oriented (aka owner-oriented).
Cash is king. It takes cash to pay the bills, repay bank loans, compensate employees, purchase supplies and equipment, fund research and development, etc. If the money isn't there or coming in, don't expect the business to last. So, taking a cue from Jim Slater, a worry-free business should be a strong, positive free cash flow generator. The world's best businesses have proven to be strong generators of a positive free cash flow.
Finally, the worry-free business needs to be conservatively financed. As worry-free investors, we should only own businesses that carry little to no debt — or, more specifically, little to no long-term debt.
These five characteristics are the heartbeat of any worry-free investment that generates great wealth. Businesses that fail to meet all five criteria are not worthy of investment.
"Try to find a business that you can understand, that's not particularly complicated, that has a successful long-term track record, makes an attractive profit, and can grow over time." — Bill AckmanCHAPTER 5
TAKE THE CHALLENGE
On March 10, 1986, I entered the United States Marine Corps and began basic training at Parris Island, South Carolina. Not even in my wildest dreams could I have imagined what awaited my arrival. For about 12 weeks, other recruits and I were put through some of the toughest, most grueling training imaginable — at least, that's what I believe. It was not only physically demanding but mentally demanding as well. The drill instructors made life miserable for us, but I understood what they were doing was for my benefit and for the benefit of the other recruits. In Marine Corps basic training, 100% is never enough. You must push yourself beyond your limits because failure is not an option.
Some of my friends wanted to know why I chose the Marine Corps out of all the branches of service I could have entered. I told them I love a challenge, and I had been told that the Marine Corps had a really tough training program. (That's an understatement!) At the completion of basic training, I was one of three recruits in my platoon to graduate with Honors. I gave it my all and it paid off.
Perseverance was my key to success here, and it will be yours as an investor, too. Are you willing to take the challenge? You probably have heard the expression "knowledge is power," but I believe the saying is incomplete. I'm sure you know some people who are smart and knowledgeable in different areas of life, yet their lives are a mess. Well, knowledge is power, but it must be the right knowledge and it must be put into action. Don't just read this book and put it aside to collect dust. Take the challenge and put this information to use. Be a person of action!
"Everyone has the brainpower to make money in stocks. Not everyone has the stomach. If you are susceptible to selling everything in a panic, you ought to avoid stocks and stock mutual funds altogether." — Peter LynchCHAPTER 6
INVESTING DISCIPLINE IS ESSENTIAL TO SUCCESSFUL INVESTING
The very first thing recruits are taught when they arrive at Marine Corps Recruit Depot Parris Island is the importance and the necessity of discipline. Discipline is instilled in the recruits throughout the entire basic training program to the point that its importance would be hard for any recruits to ever forget. Discipline is just that important for the day-to-day operations of the world's finest and fittest organization of fighting men and fighting women.
During my basic training many years ago, the drill instructors would give the command "zero" to my platoon. In response to the command, all recruits were required to immediately cease what they were doing, regardless of the activity, and would become perfectly still. It did not matter if we were taking a shower, shining our boots, cleaning our weapon or sitting on the toilet — we immediately froze in place and began to repeat the following statement in unison: "Sir! Discipline is instant, willing obedience to all orders, respect for authority, self-reliance and teamwork Sir. Freeze Sir!"
After completion of the statement, we remained completely still until we were given permission to move. Just as a great dedication to discipline is necessary during military service, it takes a similar level of dedication to discipline to obtain great success through stock investing. Throughout this section, I will refer to the discipline I'm talking about as "investing discipline" or simply as "discipline" to keep things simple.(Continues…)
Excerpted from "You Can Invest Like a Stock Market Pro"
Copyright © 2018 James Pattersenn Jr..
Excerpted by permission of Trilogy Publishing Group.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.
Table of Contents
Part One Stop Making Excuses — Let’s Get Started
Yes! You Can Invest Like A Pro!
Can You Afford Not To Invest?
Investing The Worry-Free Way
Characteristics Of A Worry-Free Business
Take The Challenge
Investing Discipline Is Essential To Successful Investing
Finding Extra Money To Fund Your Investment Program
The Financial Planner
Investing In The Information Age
Today’s Youth And Investing
The Power Of Compounding
Interesting Facts About Investing
Recession: Isn’t That Good News?
The Amazing Irving Kahn
Part Two The Good, The Bad And The Ugly — Systems, Tools,
Principles & Strategies
Build A Cash Reserve
Buy-And-Hold Investing Is Dead, Not!
Day Trading: A Hazard To Your Wealth
The Motley Fool & The Caps Rating System
Industries And Sectors Worth Avoiding
Twelve Essential Principles Of The Stock Market Pro
The Ultimate Investment Vehicle
The Stress Test For Identifying Top-Performing Stocks
What Is The Meaning Of “Fair Value”?
Margin Of Safety
Using The Modified Peg Ratio To Find Bargain Priced Stocks
Using The P/E Ratio To Estimate A Share’s Trading Price
The Stock Screener: An Investor’s Best Friend
The Practice Portfolio
The Business Calculator
Part Three The Worry-Free Stock Portfolio
Building Your Worry-Free Stock Portfolio
Keep Your Portfolio Small
When To Sell A Stock
Monitoring Your Stock Portfolio
My Personal Worry-Free Stock Portfolio (Sept. 2008 To Aug. 2013)
My Traditional Ira (May 2012 To Aug. 2013)
My Personal Worry-Free Stock Portfolio (Current Holdings)
My Traditional Ira (Current Holdings)
Recent Traditional Ira Transactions
Part Four The Untameable Stock Market
What Do We Really Know? (Written In January 2008)
It’s Official (Written Tuesday, Dec. 2, 2008)
One For The Ages
2015 In Review
2016 In Review
Part Five We’re Almost Done
Wrapping It Up!
God And Wealth
Most Helpful Customer Reviews
Pro in investment I truly appreciate that I got this book. I gave me full insight in the mechanics of investments. The structure and in-depth knowledge about the topic is phenomenal. I really learned a great deal more. The author provided tips and sound advice to whomever is interested in investing. All information is extremely useful. Very reader-friendly, especially like me, who is not a pro in this field. This has me really considering investing for a much secure future. I highly recommend this book. I received a free copy of this book via Booksprout and am voluntarily leaving a review.
Interesting tips I recommend reading the letter from the author in the beginning of the book. It speaks volumes as to the content of the story and showing when and when not to publish, especially a book like this. The book is divided into parts, and even if you don't want to invest a lot, it's a book that provides good tips and hints, and a lot of researched information. The information was from experience and research, and shows Pattersenn has some authority and credentials on this topic. Of course, telling the reader they can be wealthier than they ever thought possible may grab the reader's attention, but it's not smoke and mirrors. It's credible information that a reader can follow without being lost in market or investment jargon, giving new investors the tools they may need.