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I had a conversation recently with an acquaintance who's a couple of decades older than I am.
Once we were done moaning about the Orioles and when we were finished incorrectly forecasting the upcoming college football season, the discussion turned to the markets.
This gentleman has done very well for himself in his lifetime. Financially, he's pretty much set, and his kids are going to be in good shape as well.
That's why I was shocked when he started asking me about Facebook Inc. (Nasdaq: FB), Amazon.com Inc. (Nasdaq: AMZN), Netflix Inc. (Nasdaq: NFLX), and other market darlings.
He's already rich, but he's risking big chunks of his capital on high-multiple stocks that pay no dividends.
What's worse, they can - and often do - decline rapidly if they disappoint the Lords of Wall Street. Just look at Facebook.
I had to get to the bottom of this...
About the Author
Tim Melvin is an unlikely investment expert by any measure. Raised in the "projects" of Baltimore by a single mother, he never attended college and started out as a door-to-door vacuum salesman. But he knew the real money was in the stock market, so he set sights on investing - and by sheer force of determination, he eventually became a financial advisor to millionaires. Today, after 30 years of managing money for some of the wealthiest people in the world, he draws on his experience to help investors find "unreasonably good" bargain stocks, multiply profits, and build their nest eggs. Tim tirelessly works to find overlooked "hidden gems" in the stock market, drawing on the research of legendary investors like Benjamin Graham, Walter Schloss, and Marty Whitman. He has written and lectured extensively on the markets, with work appearing on Benzinga, Real Money, Daily Speculations, and more. He has published several books in the "Little Book of" Investment Series and a "Junior Chamber Course" geared towards young adults that teaches Graham's principles and techniques to a new generation of investors. Today, he serves as the Special Situations Strategist at Money Morning and the editor of Peak Yield Investor.
I like the way you made your recommendations, I can really follow it. Chantal Voltaire