Fools were out and about this week in an investing world jampacked with actions and ideas. Here are three articles you might find useful as you decide how to invest your money.
Value Investing Is Dumb
Never stop reading at the headline. Fool editor and writer Jim Royal makes a case for investing in "momentum" stocks such as Netflix (Nasdaq: NFLX ) and Chipotle (NYSE: CMG ) -- both of which are recommended by Motley Fool investing newsletters -- but over the years he's become an ardent proponent of so-called value investing.
"Momentum investing has no true exit strategy," Jim wrote. "Why should a [price-to-earnings ratio] of 67 or 93 be the correct valuation? Investors may bid the valuation higher, but they might finally decide not to." Jim would rather used value-based methodology to figure out a stock's intrinsic value, so he knows whether it really is worth buying at a certain price.
Jim also notes that many value stocks pay dividends. For instance, Frontier Communications (NYSE: FTR ) , of which Jim owns shares, sports a payout of 8.2%.
Read the rest of the article to learn more about why value investing is not dumb.
Three Retail Plays for the Holidays
Retail stocks are taking center stage as the holiday shopping season is upon us. Wal-Mart and Amazon.com loom large, but Fool contributor Sean Williams found three other retailers standing above the competition: Aeropostale (NYSE: ARO ) , Volcom (Nasdaq: VLCM ) , and Zumiez (Nasdaq: ZUMZ ) .
"All indications from these retailers show strength coming from younger shoppers," Sean wrote. To get a flavor of this segment of the market, check out this bit from Volcom's "brandifesto": "Volcom is a modern lifestyle brand that embodies the creative spirit of youth culture. … The goal of Volcom is to provide clothing to people who share our passion for art, music, film, skateboarding, surfing, snowboarding, and motocross."
Check out the article to see Sean's rundown on why these three stocks might fit in your portfolio.
Gold: What the Money Masters Are Doing Now
Fool contributor Alex Dumortier took at look at what some smart investors are doing with their gold investments, and he wasn't pleased by what he found. For instance, George Soros was selling shares in SPDR Gold Shares (NYSE: GLD ) but buying shares in the competing iShares Gold Trust in roughly the same amount.
Alex takes note of value investors who have placed bets on gold and concludes that "when even value-driven investors start buying a speculative asset with no intrinsic value, it's an unsettling trend, to say the least." See the article to read more.
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