Every Wednesday, we publish our “Investor Toolkit” series on TSI Network. Whether you’re a new or experienced investor, these weekly updates are designed to give you specific advice on the fundamentals of successfully investing in the stock market. Each Investor Toolkit update gives you a fundamental tip and shows you how you can put it into practice right away.

Today’s …read more »

Whether you’re a beginning or experienced investor, it’s always a good idea to review the fundamental points of successful investing. That’s what we give you in our new “Investor Toolkit” series. Every Wednesday, we’ll give you a new fundamental easy investing tip and show you how you can put it into practice right away. We hope you enjoy and profit …read more »

We designed our Successful Investor ratings (Highest Quality, Above Average, Average and Extra Risk) to help you quickly and easily identify the best investments for long term profits. These stocks have the asset size and investment quality to weather market downturns and changing industry conditions.

You’ll find our rating next to each stock we recommend in our newsletters — including the …read more »

TSI Network gives me a wide variety of ways to communicate with Canadian investors. It also gives you exclusive access to the very latest advice on investing in the stock market and a wide range of other financial matters.

Through my free Daily Updates, I keep you up to date on the issues that are most important to you — …read more »

TOYOTA MOTOR CO. ADRs $74 (New York symbol TM; Conservative Growth Portfolio, Manufacturing & Industry sector; ADRs outstanding: 1.6 billion; Market cap: $118.4 billion; Price-to-sales ratio: 0.6; Dividend yield: 1.3%; WSSF Rating: Above Average) has dropped 13% since the start of 2010. That’s mainly because the company recalled 8.5 million cars to fix problems that could lead to sudden acceleration.

The …read more »

When clients join our Successful Investor Wealth Management service, they often ask us whether they should hold bonds or focus more heavily on stocks. This is a particularly important question for investors who rely on their portfolios for income.

It’s important to note that there is no single “best portfolio” for every investor. Higher potential for loss comes with higher potential …read more »

Here are four common mistakes to avoid when investing in the stock market. All can seriously hinder your portfolio’s long-term results.

1. Focusing too heavily on cutting costs: Cutting the costs of investing has an immediate, obvious benefit: it leaves you with more money. But some cost-cutting investment techniques can wind up costing you money in the long run.

For example, some …read more »

Investors sometimes ask us how to select the best investments for young children. If children are under the age of 18, they cannot yet invest as adults. However, there are a couple of savings and investment options available.

The first option is for you (or the child) to open a bank account in the child’s name. Interest paid on small balances …read more »

When investors are just starting out, they typically have modest amounts of money to invest. You can start your stock portfolio with as little as $10,000, say, but keep in mind that the less you invest at any one time, the higher the percentage your broker’s minimum commission takes from each trade.

(Starting and building a portfolio, and how many stocks …read more »

Investors are paying more attention to dividends as volatile stock markets continue to recover.

That’s because dividends are more dependable than capital gains as a source of income. In fact, dividends typically contribute up to a third of an investor’s long-term return. Tax cuts in recent years also mean that you pay roughly the same tax on dividend income and capital …read more »

When investing in the stock market, most investors place “market orders” or “limit orders.”

With a limit order, you specify the highest price you are willing to pay to buy. The main risk here is that you won’t get a fill for your order if there is no stock available at or below your price.

This introduces a filtering mechanism that …read more »

No matter whether you are a new investor or a seasoned veteran, these four key tips can help you learn how to trade stocks and make greater profits with less risk. They’re at the core of the advice we give in our investment services, including Canadian Wealth Advisor, our newsletter for more conservative investors.

Successful Investor Tip #1: Hold mainly high-quality, …read more »

Consolidating can be a profitable business strategy, but be wary of underestimating its risk.

A consolidator operates in a fragmented industry, and grows by buying up smaller competitors. It then cuts costs at acquired firms and increases sales to its newly acquired customers.

In fragmented industries, some buyers always want to sell, if only to retire. But buyers are scarce, since banks …read more »

We hope you have been enjoying and profiting from our daily updates on TSI Network.
Aside from the daily updates, TSI Network offers a number of other stock market education benefits, including almost 4,000 articles on individual investments and how you can use our time-tested investing philosophy to maximize your investments.
TSI Network’s glossary section is one of our key stock …read more »

When you join my Inner Circle service, you get to ask me your own personal investment questions, plus you get to see what other Inner Circle members have asked. So you can see how the service works, and get a sense of how it might help you make good investments, I’d like to share just a couple of recent member …read more »

Opening a brokerage account is often one of the first steps beginning investors take when they start investing in the stock market.

You’ll first have to choose whether a full-service or discount broker is right for you. (This is one of the questions we help you answer in our new special report, “Canadian Stock Market Basics: How to Trade Stocks …read more »

The “pendulum theory” grew out of Sir Isaac Newton’s 17th-century studies of gravity and physics, particularly his second law of motion. Yet the theory turns up in discussions of all sorts of non-mechanical topics. This includes investors’ efforts at understanding the stock market.

You could sum up the investment version of the theory like this: stock prices alternate between periods of …read more »

It’s always a good idea to sell if you have any doubts about the integrity of the people who are in charge of a company. In other words, if you think a company is run by crooks, you should sell right away, no matter how attractive it seems as an investment. There are no limits to the ways in which …read more »

In our Financial Question of the Week, we recently asked TSI Network users how many stocks they own.

The results were as follows: 33% of users owned 16 to 30 stocks, 29% owned five to 15, 21% owned less than five and 17% owned more than 30.

So what is the right number of stocks to own? It’s a piece of investing …read more »

Simply put, a well-constructed stock portfolio will make your life easier and maximize your gains.
Early in their investing careers, many investors have only a vague idea of the value of a planned portfolio when investing in the stock market.
When you try to pick a handful of stocks that will all beat the market, you are asking a lot of yourself. …read more »

I am pleased to announce the launch of our new web site, TSI Network (www.tsinetwork.ca). Building on our four newsletters (Canadian Wealth Advisor, Stock Pickers Digest, The Successful Investor and Wall Street Stock Forecaster), the site will contain archives of over 2,000 articles on individual investments.

I’ll be the host of TSI Network. Every day, Monday to Friday, I’ll post free …read more »

We’ve got four key Successful Investor investing for beginners tips that will help you profit from stock investing with less risk.

No matter how widely or narrowly you cast your information net, some of your investments will disappoint you. But that won’t matter if you apply these three tips. That’s because your near-inevitable gains will overwhelm your all-but-unavoidable losses.

Successful Investor …read more »

The p/e ratio (the ratio of a stock’s price to its per-share earnings) is one of many handy investing tools. The concept seems straightforward: A high p/e means a stock is expensive, a low one means it’s cheap. If only it was so simple.

The problem is with the “e”. Reported earnings are an accounting assessment. Projected earnings are an outsider’s …read more »

It pays to stay out of new stock issues. Most come to market when it’s a good time for the company and its insiders to sell. This may not be, and often isn’t, a good time for you to buy.

New stock issues start out with a big marketing push by the firm that sponsors them. When the initial hoopla ends, …read more »

Now more than ever we think you need to invest in only the highest-quality mutual funds. Here are some keys to building a sound portfolio with these mutual funds.

Diversify. Spread your portfolio out over several funds that practice a variety of investing styles. Vary your exposure to each style to reflect your individual financial circumstances, temperament and goals.

Invest in just …read more »

When stock prices go down as much as they have lately, it generally means the stock market offers some highly attractive buying opportunities. But many investors now wonder if we are headed for a period of years of weak stock markets.

In fact, we’ve already gone through more than a decade of unsettled stock markets. Stock prices have dropped more than …read more »

partly because so many commentators are talking about the risk of a 1930s-style depression.

That kind of talk is common in any deep stock market setback. But this time it’s closer to home, due to plunging house prices and the troubles of the auto industry.

To top it off, President Obama has taken to warning that we risk a new depression if …read more »

When making investment decisions, chart reading seems much simpler than delving into and weighing the fundamentals. It appears to be a winning combo of moneymaker and time saver.

Some successful investors find it helps to know a little about charts. But if you rely on charts at all, you should look on them as just one of many things to consider …read more »

Economic turmoil over the past few months, and the sharp drop in stock prices, have rekindled investor interest in bonds. This is understandable, since bonds provide steady income streams and a guarantee to repay the principal at maturity.

However, bond prices will likely fall over the next few years as interest rates inevitably rise again. Big government budget deficits could spur …read more »

Some investors base buy and sell decisions in part on p/e ratios (the ratio of a stock’s price to its per-share earnings). When we provide a p/e, we try to eliminate all one-time items from earnings. These include writedowns, investment gains or restructuring charges. This gives you a clearer, truer view of a company’s profitability.

For decades, investors have used p/e’s …read more »

In a bear market, or stock market downturn like the one we are now in, investors spend a lot of time wondering about “the bottom”.

Sometimes, the market seems to turn around overnight, and the indexes quickly shoot upward. Other times, the indexes bump along near the bottom for months or even years.

Here are two consistent things about bottoms:

1. You …read more »

The $50 billion Madoff affair no doubt qualifies as the swindle of the year for 2008, and rivals Enron in financial history. If so, let’s hope investors look closely to see where the money went.

So far, media accounts reflect brokers’ views that Mr. Madoff’s stated investment strategy was sound, and that it only failed because he had too much money …read more »

Starting in 2009, Ottawa’s new Tax-Free Savings Accounts (or TFSAs) will let you earn investment income — including interest, dividends and capital gains — tax free. The new accounts are open to Canadian residents who are at least 18 years old and have filed at least one tax return.

A nice complement to RRSPs
Unlike RRSP contributions, TFSA contributions DON’T give you …read more »

If you want to invest in index funds, we think you should stick with exchange-traded funds (ETFs) like those we recommend as buys.

ETFs are like open-ended index funds in that they trade at net asset value. But ETFs trade on stock exchanges, just like stocks.

You’ll have to pay brokerage commissions to buy ETFs. But you’ll make that back quickly with …read more »

Investing for beginners can seem like a real challenge. There are a huge number of investment options to choose from, so how do you evaluate the choices?

There are three key questions you should probably ask when you are evaluating any of your investments:

1. Is this a good-quality investment?

2. Is it right for me?

3. What’s the market likely to do and …read more »

Our three-part investment approach focuses on where you should put your money. Our advice is to invest mainly in well-established companies, spread your money across the five main economic sectors and downplay investments in the broker/media limelight.

Investing this way takes a lot of the risk out of the more difficult question of when to buy and sell.

Still, it’s a …read more »

“Penny” mining stocks are some of the riskiest stocks you can buy. These companies are trying to find mineral deposits that can be mined at a profit, and such finds are exceedingly rare. Because of this, it’s even more important to look for investment quality in Canadian penny stocks.

It may seem contradictory to use the terms “investment quality” and “Canadian …read more »

The world is full of conflicts of interest, especially when it comes to stock advice, so investors need a healthy sense of skepticism. That’s especially so with junior companies, because they sometimes pay for their stock to be recommended in an investment publication.

A stock promoter may pay all or a large part of the cost of sending an investment publication …read more »

Despite the bear market underway in the U.S., the resources boom continues here in Canada. Some investors think it will keep on rising indefinitely, due to slower but continuing growth in India and China.

Resources prices may be headed much higher in years and decades to come, but they remain cyclical. That means you’ll see periodic collapses along the way.

We see …read more »

Every investor would like to find a fits-on-a-T shirt formula or stock philosophy for deciding when to buy or sell. It would make investing life so much simpler.

In my experience, however, these formulas and the solutions they give you never provide dependable guidance. Sometimes a stock philosophy will work and other times it will not. The outcome of applying …read more »

We avoid most new stock issues for a very simple reason: Human nature dictates that new issues will generally come to market when it’s a good time for insiders or the company to sell. That needn’t be, and often isn’t, a good time for you to be buying.

If, while you were investing in the stock market, you bought every new …read more »

Everybody knows it’s hard to beat the market over long periods. Fewer investors recognize that it’s easy to do a lot worse than the market. It’s especially easy if you fall for every new investment innovation that comes along.

Exchange-traded funds (ETFs) are an investment innovation that has advantages over some alternatives, but can still lead to steep losses. ETFs give …read more »

Today many investors assume the price of oil is bound to keep rising indefinitely. Mostly they base that view on the potential for increased car ownership in India, China and other newly industrializing countries.

To top it off, they assume that all the world’s great oil finds have already been discovered. It’s hard to disagree with those assumptions or that line …read more »

Years from now, I suspect we’ll look back on the Bear Stearns collapse as having happened around the end of the 2007-2008 market downturn. That doesn’t mean the market will turn around tomorrow. The bottom could come in a month or two, or prices could fluctuate around the lows for some time.

Even if the bulk of the drop in the …read more »

We created our Stock Pickers Digest Hotline to keep you up-todate on our recommendations, and tell you when they change. We also make the Hotlines available to you on the Internet, so you’ll never need to worry about missing a Hotline.

As a subscriber, you can receive our Stock Pickers Digest Hotline every week (48 or more time per year) by …read more »

Before letting any investment rule for tax shelters play a role in your retirement investing decisions, make sure it makes sense for you in today’s market.

For instance, one long-standing retirement investing rule for tax shelters says you should hold fixed-return investments, like bonds, in your RRSP and hold stocks outside your RRSP.

Its rationale is two-fold. First, bonds are safer …read more »

Savings accounts at banks and trust companies pay annual interest rates as low as 0.20% and require minimum balances or monthly service plan charges to avoid transaction fees and maintenance charges. But these two institutions offer you much better deals:

ING Direct (1-800-464-3473) offers a no-fee, high-interest savings account that currently pays 3.75%. ING’s Investment Savings Account has no minimum deposit …read more »

Long-term studies show that stock market performance as a whole generally produces total pre-tax annual returns of 10% to 11%, or around 7.5% after inflation.

Returns will vary widely from year to year, of course. But I think the market will generate average annual compound returns of 10% to 11%, or 7.5% after inflation, over the next couple of decades as …read more »

In this month’s issue, you’ll find seven new buys which we first recommended in our service for aggressive investors, Stock Pickers Digest. Their subsequent gains ranged as high as 1,920.0%, but we feel each of them has further gains ahead.

The Successful Investor has two main goals. First, we explain our 3-pronged investment approach, which consists of investing mainly in well-established …read more »

So far, the market downturn seems to have stayed within the limits we envisioned for it in our July 27 Stock Pickers Digest Hotline, and last month’s issue.

However, no one can consistently predict the market’s future. That’s why you need to take a portfolio approach to your investments, including any aggressive investments you hold.

Our aggressive recommendations vary widely in risk, …read more »