Professor Glen Arnold

In a 2016 paper Jeremy Siegel agrees that the cyclically adjusted price earnings, CAPE, ratio “has served as one of the best forecasting models for long-term future stock returns” but that, in 2015, recent forecasts of future equity returns were, in his reasoned opinion, too pessimistic using the CAPE ratio. (Financial Analysts Journal Vol. 72, […]

I’m going to try and gather my thoughts on the US financial markets over the next few weeks (meaning occasional posts). It is possible that we are coming up to one of those big turning points, so I want to build up my knowledge and preparedness by searching for useful facts. I’ll start with a […]

A thirty two year old Warren Buffett, in 1962, wrote to his investment partners: “Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good results.” Some share buyers seem to think that they do not need to pay too much attention to the underlying […]

Charlie Munger, Buffett’s partner in running Berkshire Hathaway said: If you took our top fifteen decisions out we’d have a pretty average record. It wasn’t hyperactivity, but a hell of a lot of patience. You stuck to your principles and when opportunities came along you pounced on them with vigour.  Given this observation how do […]

Today I want to highlight an important principle for value investors to bear in mind. Peter Lynch, fund manager for the Megellan Fund at Fidelity, where he averaged a 29.2% annual return, said: “As often as a dull name in a good company keeps early buyers away, a flashy name in a mediocre company attracts […]

Arden (LSE:ARDN) had been in bad way for years when Luke Johnson, a famed entrepreneur and investor in start-ups and young companies, bought over 10% of its shares in 2014 for about £1m. He too has lost money on this investment so far. As the company continued to decline he joined the board two years […]

Arden (LSE:ARDN) has an appalling profits history – displaying an overall loss over seven years. It works in an industry vastly over-supplied and therefore extremely competitive. Relatively few small and medium sized companies have chosen to join the stock market in recent years. Large numbers of corporate brokers go chasing after the dwindling band of […]

Arden Partners (LSE:ARDN), a small stockbroking based in the Midlands and London, was bought for my net current asset value, NCAV, portfolio in September 2015 at 42.2p. They have paid no dividend and the share price has fallen to 33p, so the paper loss on this investment is 22%. Should I cut my losses, continue […]

Haynes (LSE:HYNS) was selected for my modified cyclically adjusted price-earnings ratio, CAPE, portfolio in Feb 2015. To think through whether it remains a good investment I’ll use the three stages I used back then. First, is the cyclically adjusted price-earnings ratio significantly below average? The average earnings per share for Haynes over the past 11 […]

Last week Haynes (LSE:HYNS) reported revenue up 15% and earnings per share up 75% for the six months to November. This Newsletter will unpick those results and put them in the context of company’s recent history. The first thing to note is that the numbers are flattered by the drop in the pound. Much of […]