When Book Value is Rubbish

Firstly, for some academic background to this article read this one: Smoke, Mirrors & Balance Sheets. Now, when is it justified that a stock trades below book value? Well, the answer is simple enough: when book value is overstated. But how … Continue reading

Illustrating Investing in the Small Cap Cycle

I have drawn this rather crude illustration of what some call the “small cap cycle”. The Y-axis of profit stands for the growing profits of the business as well as the increasing investment returns over time (as, in the long-term, … Continue reading

How Does Acquisitive Growth Work?

Due to consolidation accounting (or “Group accounting”) rules, when one company controls another one (from 50% + 1 vote up to full-control of 100%, depending on circumstances), that first company (or the “parent” company) gets to accounting for both the financial … Continue reading

Company Valuation Basics

This article is following on the series that I began posting here: The Four Pillars of Company Fundamentals. This second batch of videos present an overview and the basics of various valuation approaches for stocks. A notable valuation model missing from this … Continue reading

The Four Pillars of Company Fundamentals

The videos below are from a series I ran on JustOneLap.com a good couple years ago. Sure, I could probably do a slightly better job presenting some of these topics nowadays and/or modernize one or two examples, but the essence … Continue reading

JSE Power Hour: Start-to-End Investing in Small Caps

Last night I gave a presentation at the JSE about investing in small caps. The idea was almost to present a turnkey solution to investing in this part of the stock market. For this reason, the presentation starts very basically … Continue reading

Generating Investment Returns in Sideways Markets

Since about mid-2013/14, the JSE All Share Index (as with most global equity markets), has neither been in a bear market nor a bull market. Rather, it has been in a flat, range bound market, or, as I prefer to … Continue reading

A Forgotten Safeguard: Diversification

The global economy is desynchronised with significantly diverging views at both global and country-level. China could implode, Europe could fragment and USA could falter. All of these could happen. And then you get commodity volatility coupled with massive forex swings (up … Continue reading