STE's Stocks Investing Journey

When Alpha Becomes Beta What is Alpha? The concept explains: ( From Investopedia ) As a measure of   performance   on a risk-adjusted basis. Alpha, often considered the   active return on an investment, gauges the performance of an investment against a   market index   used as a   benchmark since they are often considered to represent the   market’s   movement as a whole. The   excess returns   of a fund   relative to the   return   of a benchmark   index are the fund's alpha.

Why do we need a Stock Watch List? I guess most of the investors are having their own stocks watch list in hand which they intended to buy when opportunities arise. Having a watch list of potential investments next to your workstation allows you to seize upon opportunities presented by the sometimes over-react Mr Market. Armed with a watch list, investors will be at an advantage position as he or she can simply wait for good investments to arise rather than going out looking for them when needed.

“ Scripophilist or Karung Guni “ image credit to reddit.com According to “ The Free Dictionary “ , Scripophilist is a person who collects expired or antique bond and stocks certificates. These certificates can be valuable to the study of economic history and often have value themselves as collectables.

According to Wikipedia: I'm OK – You're OK     is a 1969   self-help   book by   Thomas Anthony Harris . It is a practical guide to   transactional analysis   as a method for solving problems in life. The book made the   New York Times   Best Seller list   in 1972 and remained there for almost two years. It is estimated by the publisher to have sold over 15 million copies to date   and to have been translated into over a dozen languages. 

Why Smart People Make BIG Money Mistakes! This is one of the books I like the most and would recommend to readers who intend to learn more about “ Behavioral Finance “ in a more practical and laymen terms. A fascinating and practical manual: Looking at the ways we spend, save, borrow, invest, and waste money. It explain why so many otherwise savvy people make foolish financial choices, like why investors are too quick to sell winning stocks and hold on to the losing shares , why borrower pay too much credit card interest and savers can’t save as much as they would like and why so many of us can’t control our spending.

One of the books which I read a few times in “ My Book List “  was the one called “ More Than You Know “ from Michael J. Mauboussin , other than “ The Most Important Thing “ from Howard Marks. According to Wikipedia: Michael J. Mauboussin   is managing director and head of Global Financial Strategies at   Credit Suisse, where he advises clients on   valuation   and   portfolio   positioning,   capital markets   theory, competitive strategy analysis, and decision making. 

Before I start to explain the 3 rd and 4 th elements, allow me to quote below from Warren Buffet which is very much related today’s blog post :