Ford Motor Company is a misunderstood business. Investors appear to be simultaneously undervaluing its highly profitable gasoline-powered businesses and...
I’ve only been investing for a few years, and my average annual return is 18%. I don’t think that’s going to last; what kind of average gain should I expect over, say, a decade?That’s very hard to predict. If you invest primarily in index funds that track the broad market, such as an S&P 500 index fund, you can expect to earn roughly the same return as the index, less any fees.
The vast majority of actively managed stock funds, for example, underperform their benchmark indexes. And plenty of blue-chip stocks — such as Boeing, ExxonMobil, Procter & Gamble and Walmart — have underperformed the S&P 500 over the past decade. Superinvestor Warren Buffett recommends that most people invest via low-cost, broad-market index funds.The Fool responds:
Once you have a few promising retailers, look up their financial reports online to see how healthy and growing they really are. Most major companies’ websites have an “investors” section, offering financial reports, presentations and more. While sales reflect a company’s top line — how much money it has taken in — net income or earnings per share reflects how much of that it keeps as profit. The percentage it keeps as profit is its profit margin. Favor companies that are profitable, but don’t rule out a company just because of a low profit margin — some companies make up for that via high volume. On the balance sheet, check inventory and debt levels.
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