Some people fear their future… they lack confidence and certainty. 

They fear not having enough money and how to deal with inevitable political, economic, and social changes and international complications that may affect their money and career, how their careers will develop… 

They don’t want to be left behind. 

They lack confidence in retirement, cash disposal, and inflation. They don’t want to lose money in financial scandals and frenzy bubbles. 

They fear losing money, and some may need help understanding how the market and the world really work and how they can live a more prosperous life. 

Unfortunately, very few are the ones that learn and take the right action to change it.

Factual’s Best Strategies to Become a Successful Investor and businessman.

Most teachings can be applied to investments, management, personal and professional deals, and everyday life.

Essential elements before investing:

Before thinking about investing, know your reality.

• Which company/asset/product;
• Which conditions (quality, price, quantity, time,…)
• What price to pay?
• Be aware of the risk of buying a great company at a bad price. Sometimes it’s preferable to purchase a good company for a fair price.
• When to buy?
• Do earnings and dividends will continue or become more attractive with time?
• For who?
• What’s your actual financial condition?
• What’s your financial and business knowledge?
• What are your skills? Do you have the right temperament? What are your preferences?

(Excerpt adapted from research on Security Analysis: Credits to Benjamin Graham & David Dodd).

Strategies for Asset Allocation:

• Buy assets in tranches;
• Sell assets in tranches;
• Hold diversified assets (8-12)
• Check your assets each month and rebalance them when needed.
• Choose not to make many trades or speculate not to become a trader.
• Maintain a buying movement when prices are lower than your expected valuation. If possible and aligned with your goals/objectives.
• When looking for numbers, try to find consistency between results, past and present, and growth.

Overall View: 

• Avoid investing in less than 6/8 stocks.
• Plan in advance for the results you want to have.
• Buy stocks focused on the results you want to have.
• Avoid changing strategies.
• Avoid checking stock prices daily.
• Avoid reading stock news regularly.
• Continue studying and practicing the concepts we taught you.
• Think before acting.
• Don’t use leverage.
• Don’t use buy and sell options.
• Don’t use Graphics Analysis to buy, sell or hold stocks.
• Focus on Business, Management, and Financial Facts.
• Stay calm when markets are low, and think about buying the best stocks.
• Keep relaxed when stocks are higher, don’t get emotionalized.
• Don’t spend too much time on trends and the next big thing. Most trends are driven by propaganda.
• Avoid following someone else’s opinion.
• Avoid following the stock broker’s advice.

Best Strategies to sell stocks wisely:

• When you need the money.
• When the asset had enough valuation.
• When there’s a new opportunity in the market.
• When you need to rebalance your risk exposure (rebalance your portfolio).

Best Strategies for Holding stocks wisely:

• When it’s aligned with your holding investment teases.
• When you see future valuation measured by tangible facts (ex: competitive advantages).
• When you don’t see better upside opportunities.
• When your holdings portfolio is balanced.

Takeaways.

• Allocate the capital that relies on your return expectations over time;
• Always try to allocate more capital;
• Reinvest profit and earnings when possible (Compounding is one of the best risk structures);
• Reinvest in what is the best opportunity over time;
• Keep generating flows of income on your investments;
• Diversify when risk mitigation is needed, but don’t forget that a good (quality) concentration can also be a risk mitigation factor);
• Be exposed to different assets;
• Be exposed to other currencies and protection;
• Keep your portfolio balanced with your macro perspective.
• For additional information on this class, please visit Smart Wallet Course.

Guide to the Factual Method.

What are the best stocks to buy today?

The Factual Method is a method for businessmen, entrepreneurs, managers, executives, investors, and organizations, covering the Best in Management and Corporate Finance based on the Factual Method of Business Analysis, Management, Stocks, and Real Estate Investment Funds.

Best Strategies to buy stocks wisely:

The Factual Method Business Analysis.

Step One:

• Revenue;
• Operation;
• Net Profit Margin;

Step Two:

• Low Debt;
• Good Liquidity;

Step Three:

• Competitive Forces (Profit Margin, Wide Moat Concept, Porter Competitive Forces);
• Historical Consistency & Strengths;

Step Four:

• Cash-Flow;
• Personal Market Perspective;

Step Five: Indicators

• EV/EBITDA (If companies deliver great returns, they are expected to reach the enterprise value in less time, study what that means).
• ROIC (Great companies make a great return on invested capital over time, to learn more, study ROIC);
• P/E (Lower than eight is great, but it can be a trick, study about P/E);
• Price-To-Book (Less than Booking Value is good, study what that means).

Step Six:

• Further analysis.

Step Seven:

• It’s possible to use a valuation method to buy stocks with a good margin of safety and potential for profit.

Keep your mind in the right place, and remember, great actions bring excellent results in life. Remember to stay determined, consistent, patient, and focused.

We don’t give investment advice, don’t give investing tips, and don’t recommend stocks and investment products. We don’t provide any type of advice and consulting in the investment segment.

Good planning and actions make incredible results in life.

We’ll keep updating you on the proper education to do successfully investing.

Keep walking the path.

Marcelo Marini

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