100 to 1 in the stock market;: A distinguished security analyst tells how to make more of your investment opportunities, Hardcover – January 1, 1972 by Thomas William Phelps talks about Buy and Hold investing., which capitalideasonline posted . First an Capital Ideas Online excerpt followed by a little on the book.
100 to 1 in the Stock Market
Continued from the last post:
I came across a stock-market classic, “100 to 1 in the Stock Market” by Thomas William Phelps, given to me by a friend.
41. “Robert G Wiese, scholarly Scudder, Steven & Clark dean of investment research and partner in Boston, puts it more neatly: “investors don’t’ pay different prices for the same thing. When they seem to be doing so they are paying like prices for different anticipations.”
42. “Wise investors do not buy a stock just because it is going up or is expected to go up. Wise investors buy because they foresee an increase in earnings and dividends that will make today’s price look cheap in years to come. Even the wisest sometimes misjudge the future of earnings and dividends. Only fools – and perhaps some professional short-term traders – buy without giving that future a thought.”
43. “Between twenty-five and thirty years ago dividend yields on stocks were three times as great as interest yields on bonds. This made sense only if one assumed that dividends on stocks were highly undependable and very likely to decline over the years to come.
Actually, instead of declining, dividends rose steadily until about five years ago. At the same time the price per dollar of dividends rose relative to the price per dollar of bond interest. At the recent peak the investor could get almost twice as high a yield on the best corporate bonds as he could get on an average of fifty leading common stocks. In other words in a single generation the price of dividends rose from a third of the price interest to almost twice the price of interest. It would be hard to imagine a more dramatic demonstration of the impact of a change from pessimism to optimism on security prices.
…………………………..
Three years in the trenches.
Two wounds.
One wife.
Four children.
Seven months out of a job.
Total seventeen.
Please help.”
See full article via Capital Ideas Online
100 to 1 in the Stock Market – Book Review
100 to 1 in the stock market;: A distinguished security analyst tells how to make more of your investment opportunities, Hardcover – January 1, 1972 by Thomas William Phelps
100 To 1 In The Stock Market – Description
Of all the books on investing that I’ve read over the years, 100 to 1 in the stock market was at once, the most pleasurable and most challenging to my own beliefs. Mr. Phelps spent over 40 years in and around Wall Street and the world of investing. His activities included being a private investor, columnist, analyst, author and financial advisor. His career spanned from just before the Crash of 1929 to the 70?s. In spite of the the rather glamorous title, the book is actually about Buy and Hold investing. Yes, it is true that you could have made a million dollars by buying any of about 350 stocks he mentions if you had bought $10,000 worth and just sat back and watched it grow over time! Doesn’t sound that exciting, does it?
However, I hope you didn’t miss the point that he mentions AT LEAST 350 opportunities to have done this! Most of the companies’ names will be quite familiar to most readers. With the histories of many of these companies available, Mr. Phelps goes back in time to examine what it was about these companies that made their potential as great as it was. How can one begin to see what it takes for a company to do well? Well enough to drive its stock from $1.00 to $100.00 over a period of time? This is the heart of Mr. Phelps’ book. He comes up with common characteristics that show up in many of the stocks he uses as examples. Now, what about his strategy of stock ownership? He says that the best way to preserve the wealth you accumulate from investing is to NOT SELL your stocks! Uncle Sam always wants a piece of the pie when you decide to cut it! Mr. Phelps says that no matter how long it takes, it’s better to pass on stocks to your heirs than it is to sell them too soon!! Insert taken from Book Reviews for AIM Investing.
100 to 1 in the stock market;: A distinguished security analyst tells how to make more of your investment opportunities – Reviews
Of all the books on investing that I’ve read over the years, 100 to 1 in the stock market one was at once, the most pleasurable and most challenging to my own beliefs. Mr. Phelps spent over 40 years in and around Wall Street and the world of investing. His activities included being a private investor, columnist, analyst, author and financial advisor. His career spanned from just before the Crash of 1929 to the 70?s.
In spite of the the rather glamorous title, 100 to 1 in the stock market is actually about Buy and Hold investing. Yes, it is true that you could have made a million dollars by buying any of about 350 stocks he mentions if you had invested $10,000 and just sat back and watched it grow over time! Doesn’t sound that exciting, does it? However, I hope you didn’t miss the point that he mentions AT LEAST 350 opportunities to have done this! Most of the companies’ names will be quite familiar to most readers.
With the histories of many of these companies available, Mr. Phelps goes back in time to examine what it was about these companies that made their potential as great as it was. How can one begin to see what it takes for a company to do well? Well enough to drive its stock from $1.00 to $100.00 over a period of time? This is the heart of Mr. Phelps’ book. He comes up with common characteristics that show up in many of the stocks he uses as examples.
Now, what about his strategy of stock ownership? He says that the best way to preserve the wealth you accumulate from investing is to NOT SELL your stocks! Uncle Sam always wants a piece of the pie when you decide to cut it! Mr. Phelps says that no matter how long it takes, it’s better to pass on stocks to your heirs than it is to sell them too soon!!
“The reason,” he says, “that more people don’t make 10,000% on their money is that they don’t set their goals high enough!” He says that to sell a stock sooner than that is an admission that you have failed at this goal and haven’t done your homework properly! Move over Mr. Lynch! Who wants a Ten Bagger when we can shoot for a 100 Bagger!
Certainly in these times of trading stocks as frequently as heartbeats, his style seems almost radical. After all, who interviews the guy that just buys stocks? CNBC will just ignore you!
Mr. Phelps shows in one example, an investor could have seen the possibilities of a 10,000% return several times during a 40 year span! This same stock returned $100 for every $1 invested if held for 40 years, 36 years, 28 years, 20 years and also just 12 years! In other words, the stock price bounced around alot over the 40 year period. This offered the investor who was shrewd enough to have perceived the possibilities several chances to have caught that 10,000% ride! The company story just got stronger with each price cycle.
We work hard to find stocks that will give superior returns over time. We are willing to risk our money based upon our perception of the company’s future. Mr. Phelps develops very good selection skills. These same skills will benefit all long term investors.
– 100 Baggers Are Real Possibilities!, By T. Veale
100 to 1 in the stock market takes the perspective of the extremely long term investor focused on finding compounding machines in the public markets. It is geared towards the investor who spends the bulk of the investment time on the diligence process rather than trading and who is focused on buy and hold to an extreme (10+ years). The investor who benefits from this book is a rarity in today’s hyper short term focused “investor” aka speculator. This book is worth its weight in gold if one can effectively implement the concepts described here. Although it is conceptually simple, the ideas in this book are more powerful than the other investment concepts in the market today.
– Classic Buffettesque book, By blueridgemountains83
