The Dhandho Investor - Book Review

The Dhandho Investor: The Low - Risk Value Method to High Returns





What Is It About?

The book describes fundamental investing as followed by the Graham-Buffett style of value investing. The book covers topics such as business analysis, developing a focused portfolio, and understanding the value of finding low risk-high probability of success investments. Overall, the book helps new investors achieve success in the stock market following a disciplined investing approach.


What Did I Get Out Of It As A New Investor?

Straight forward book on value investing. Using examples from his own work as a private fund manager the author helps the new investor understand how to use a focused fundamental style of investing in order to achieve success. Touching on such important topics as discounted cash flow analysis, competitive advantage, and margin of safety, the book educates the new investor on the basic principles that Warren Buffett and others encourage all investors to follow. Short and to the point, the book delivers a lot of value to the new investor.


The Good News

For those who are looking for a solid introduction to focused value investing this book does the job.


The Bad News

Great book for the new value investor, less so for the more experienced investor already adept at using the techniques of fundamental investing.


The Bottom Line

If you want a book to help you understand value investing, this book can help you accomplish your goal.


Other Related Reading:

 My Review    My Review

First Things First: Knowledge, Analysis, Trigger

Participating in the market can seem to be a daunting prospect for the non-professional. Having a simple system to help acclimate one to a whole new process can be helpful. When I want to learn anything new I employ a three step process. I describe the three steps as: Knowledge, Analysis, and Trigger (KAT). Here is how I go about that process to aid my development as a new investor and trading.

Knowledge

The obvious and most simple step in my KAT system is that one must first determine where one can gain knowledge. Will you use books from Benjamin Graham or Van Tharp’s Trade Your Way to Financial Freedom, or newspapers like the Wall Street Journal? Or perhaps you will rely exclusively on charts or company reports. Whatever the case, as a new investor or trader you must first figure out how and where you will gain your knowledge.

Analysis

The second, and a more difficult step in the KAT system, is developing the ability to analyze the knowledge acquired. In other words, you must gain the ability to filter the useful from the useless. Then one must take the useful knowledge and determine what is actionable and what is not.

There are no shortcuts here at this step. The amount of information available is mind boggling and overwhelming. Without the development of a system of analysis to determine what knowledge you can use, the mere possession of that knowledge is worth nothing.

Trigger

The third and most difficult final step in KAT is what I call the Trigger, as in pull the trigger. Once you have obtained your knowledge sources and once you have developed the ability to analyze what is useful, you must then develop the emotional ability to act on your analysis. This is why the trigger is the most difficult step to develop in KAT.

Acquiring knowledge and analyzing can be easily thought of as logical processes. Pulling the trigger and applying that knowledge and analysis is not. Taking ones knowledge and analysis and implementing it, is an affirmative (and emotional) declaration that you have the self confidence and belief to take action (or inaction) when other may disagree with your conclusion.

The decision to buy a stock (or sell it) is based on knowledge and analysis, but ultimately being able to implement that decision and pull the trigger comes down to emotional confidence in ones ability. If one does not have the ability to recognize and execute that which their knowledge and analysis dictates then mastery of the first two steps of KAT mean nothing

While all this may seem obvious, obvious information is not so obvious when you are unfamiliar with a subject. For those like me who are relatively new to investing and trading, discovering the obvious is a rewarding experience. That is why I think one must understand the above three important (but perhaps obvious) things when you begin to participate in the market.

Understanding that one must gain knowledge, develop the ability to analyze that knowledge, and maintain the emotional discipline to pull the trigger on that analysis is one of the most important and basics things I could understand. And I think you should too.

Trade With Passion And Purpose - Book Review

Trade With Passion and Purpose: Spiritual, Psychological and Philosophical Keys to Becoming a Top Trader (Wiley Trading)





What Is It About?

This book explores looking within oneself to achieve greater trading success. Examining emotions such as fear, self-honesty, self-esteem, anxiety, and others, the author details how a trader must clarify their internal purpose before finding external market success. The book also discusses confronting external forces such as stress, relaxation, and self destructive behavior. The book concludes with a section on developing a trading plan.


What Did I Get Out Of It As A New Investor?

I enjoy reading trading books that focus on understanding and harnessing ones internal emotions. I say that because without an internal compass to guide the use of a trading system, that system becomes worthless. To that end, this book does a good job of providing tools to help an investor or trader understand that in the end we are the most important part of the equation when it comes to trading and investing.

To accomplish this goal the author in a comprehensive, but not boring, manner discusses those stresses, both internal and external, that market participants often face. Using interviews with other traders, sports professionals, and others, the author details how one can best harness and control those factors to a positive result. The concluding chapters also do a good job of explaining why every trading plan must have integrity to succeed.


The Good News

The book delivers a very powerful message on how trading with purposeful integrity drives success.


The Bad News

While engaging, the book does read like a college text. One may find it easier to read the book over several weeks, digesting pausing after each chapter for consideration of the material rather than reading straight through.


The Bottom Line

Solid text on not just controlling ones emotions but understanding why ones trading must have purpose and integrity.


Other Related Reading:

My Review

Anatomy of the Bear: Lessons From Wall Street's Four Great Bottoms - Book Review

Anatomy of the Bear: Lessons From Wall Street's Four Great Bottoms





What Is It About?

This book explores the nature of a bear market at its apex (although I suppose nadir more aptly describes). The book inspects four distinct bear market bottoms: August 1921, July 1932, June 1949, and August 1982. This book does not try to time when a bear market begins or ends; rather the book focuses on understanding when all excess in the market has been rung out, or in others words, trying to understand when the bear becomes satiated.

By examining events leading up to each bottom, the structure of the market during that time, and the state of the market and economy at the bottom of each bear, the author presents a balanced examination of similar factors present during all four periods. To do so the author makes the case that while each period has its uniqueness, certain characteristics present during each period examined such that one may develop an analytic process which may assist during a future bear period. Written well, the book presents the material in an interesting manner.


What Did I Get Out Of It As A New Investor?

Bear markets happen. Absent non-participation in the market, all are touched by the bear to some degree. While it is futile to predict when a bear may begin or end, enough similarity exists in the past among the great bear markets to signal opportunities to purchase stocks. This book helps a new investor or trader recognize when unwarranted and continued fear of the bear lacks justification. In short, if one cannot avoid the bear, one can at least hope to co-exist in a manner which does the least damage.

Whether one chooses to describe a market as fundamentally undervalued or technically oversold makes no difference. While it may be difficult to predict when a bear market will end, looking to past bear markets can be useful to discern when the continuing damage caused by the bear will abate. It is at this point when the purchase of equities must be considered. On this point the book is helpful in teaching an investor and trader what factors to examine.


The Good News

An accessible yet through examination of bear markets for the investor or trader which provides valuable information on the history of market bottoms.


The Bad News

Those seeking a simple buy or sell indicator to avoid bear markets may find disappointment with this book; rather, the book excels in helping the reader develop a thoughtful and broad understanding of market bottoms to aid in future analysis.


The Bottom Line

Written in a clear manner and to the point, this book covers the subject in a manner uncommon to the subject. Most works on bear markets focus on the damage a bear does, this book instead focuses on knowing when to take advantage of the positive buying opportunities a bear provides.


Other Related Reading:

My Review

VIX and More - Blog Review

VIX and More

Another blog I enjoy reading is VIX and More. As the title of the blog indicates the author discusses the sentiment and volatility of the market as expressed through the VIX. For those unaware of what the VIX is, the author does an excellent job of introducing the VIX to a new investor or trader.

But the blog is not solely focused on discussing the VIX. The blog does a great job addressing the "and More" portion of its title. For example, the blog offers readers a model portfolio to consider, a discussion of time horizons, and general comments on the state of the market.

Overall, I enjoy reading VIX and More because it covers in detail a subject not well represented by other bloggers. Of course that was the author's intent when he started his blog earlier this year. I think he does a fine job filling this niche.

VIX and More

Stock Screen: Private Equity Buyout Candidates

I collected a lot of stock screens this past year. Most use the free deluxe screener available at the MSN Money website. The screens are sometimes hard to find on the MSN website, so I thought I would share what I found.

This is a screen which looks for stocks that may appeal as buyout candidates.

Screening parameter: Market Capitalization >= 1,000,000,000

Screening Parameter: Market Capitalization <= 5,000,000,000 Screening parameter: Return on Equity >= 5

Screening parameter: Price/Cash Flow Ratio >= 1

Screening parameter: Price/Cash Flow Ratio <= 20 Screening parameter: Last Price <= 0.7 * Five-Year High Price

Screening parameter: Last Price >= 0.40 * Five-Year High Price

Screening parameter: Price/Sales Ratio <=2 Screening parameter: Price/Sales Ratio <= Industry Average P/S

Screening parameter: Mean Recommendation <= Moderate Buy

Screening parameter: Mean Recommendation >= Hold

Screening parameter: EPS Growth Next Five Years >= 10

Screening parameter: EPS Growth Next Five Years <= 15 Screening Parameter: Debt to Equity Ratio <= 0.5 Here is a link to the MSN article by Harry Domash with a description of how and why the above parameters are used.

Chairman Maoxian - Blog Review

Maoxian

Here is another great blog which is more than it seems. At first glance one may see the charts and discussion of short-term trades as an indication that the Maoxian blog is about short term technical trades. It is not. A deeper read reveals that, like all great stock market blogs, the Maoxian blog provides insight to all time frames and every style.

Since 2001, the blog author has been providing insightful market commentary for all investors and traders. For the short term technically inclined there is the original Trading for Dummies series of posts. For the more long term value oriented there are may posts like the one which reprints the Forbes interview with Warren Buffett in 1974. Read the blog long enough and you will see just how diverse, and helpful, the material is to either an investor or trader.

The best thing I can ever say about a blog is that I learn something new every time I visit. Chairman Maoxian's blog falls into that category. What did I learn today? Click on the following link to see what the Charmian had to say five years ago about the CBOE Volatility Index. Priceless.

Maoxian

Stock Screen: Strong Earnings and Price Momentum

I collected a lot of stock screens this past year. Most use the free deluxe screener available at the MSN Money website. The screens are sometimes hard to find on the MSN website, so I thought I would share them.

This is a screen that finds stocks with strong earnings and price momentum.

Screening parameter: 12-month Relative Strength >= 80

Screening parameter: 3-month Relative Strength >= 90

Screening parameter: Previous Day's Closing Price >= 1.2* 200-Day Moving Average

Screening parameter: % Price Change 1 Week <= 10 Screening parameter: Recent Qtr Surprise % >= 5

Screening parameter: Earnings Estimate Increased in the Last Quarter

Screening parameter: ROE: 5-Year Ave. >= 1


Here is a link to the MSN article by Harry Domash with a description of how and why the above parameters are used.

The Focus Investor - Book Review

The Focus Investor





What Is It About?

The book synthesizes fundamental investing by reviewing the teachings of several well known investors. Using the works of Graham, Fisher, Buffett, and Munger, the author focuses on the strengths of each. The author describes the distillation of the approaches as “Focus Investing.”


What Did I Get Out Of It As A New Investor?

A quality summary of what Graham, Buffett, and others teach with respect to fundamental investing. Covering topics such as accounting red flags, valuation, investor psychology, and the role of diversification, the author presents a theory of investing which highlights the main concepts from prominent value investors. Overall, this book provides to the new investor a means to quickly grasp the main heart of investing as practiced by Graham, Buffett, and the others.


The Good News

An excellent starting point for the new investor seeking an introduction to fundamental investing or for those having difficulty grasping the concepts.


The Bad News

While the book does synthesis the works of several great investors in one volume, for those who have read Graham, Fisher, Buffett, and Munger, this book may have limited appeal.


The Bottom Line

Well written and helpful book for the new investor.


Other Related Reading:

 My Review   My Review

Suria Investment Newsletter (SIN Letter) - Blog Review

Suria Investment Newsletter (SIN Letter)

Another website I enjoy reading is Asif Suria's SIN Letter website. Some websites discuss investing methods without reference to any particular situation others simply highlight stock picks without analysis. The better websites do both as a means of educating the reader. Asif's blog is one of the better ones.

Asif not only discusses what companies he likes but also why. As stated on his website:

Suria Investment Newsletter (SIN Letter) is a free stock investment newsletter with a focus on international investing that highlights two stocks each month. The objective of this newsletter is to provide you with unbiased initial research and basic facts about individual stocks so that you can then research them further before deciding to add them to your portfolio or not.

Each month Asif provides via email subscription a very lengthy and detailed newsletter on his current stock selections as contained in the portfolio, a discussion of general market conditions, and various ideas on the radar but not yet actionable. Here is a link to the most recent April SIN Letter. In between monthly letters Asif also comments via a blog on his website.

Overall, the Sin Letter website is well written and thoughtful website worth investigating.

Suria Investment Newsletter (SIN Letter)

Gauging Corporate Financial Results - Blog Review

Gauging Corporate Financial Results

It is my goal to review every one of the blogs I have linked to yet it seems as if I never have enough time to review the blogs I do find. Every once in a while I do run across a blog that so interests me that it jumps to the front of the line. Today that blog is Gauging Corporate Financial Results.

Normally the study of a corporations financial statements (the income statement, balance sheet, and cash flow) can be a real snoozer. Fortunately, the blog's author, Neil Carvin, came up with a process to make that study a bit more interesting.

He has constructed Four Financial Gauges that provide a quick visual read on a company's financials. The blog posts updates on specific companies evaluating recent filings using the aforementioned gauges. Here is a link to an update on King Pharmaceuticals (KG) as an example. Gauging Corporate Financial Results is doubly a worthwhile read both for the content and the manner it is presented.

Gauging Corporate Financial Results

Free Cash Flow and Shareholder Yield - Book Review

Free Cash Flow and Shareholder Yield: New Priorities for the Global Investor





What Is It About?

This book emphasizes using shareholder yield when considering a stock investment. By examining how companies use their free cash flow the authors hope to identify a class of companies who will increase the value of the company for the benefit of shareholders. As defined by the authors, shareholder yield represents the use of free cash flow to pay cash dividends, buyback stock, reduce debt, make rational acquisitions, and reinvestment in capital projects. The book focus on the first three factors.


What Did I Get Out Of It As A New Investor?

An excellent book for a new investor looking for an intermediate text on performing security analysis. The book contends that in the coming years those companies which focus on and produce shareholder yield will produce the best return.

The book makes the simple point that over time a low interest and inflation rate environment helps elevate the P/E ratio. Consequently, because we currently have historically low rates of interest and inflation, from this point forward P/E ratios can only stay constant or decrease as rates stay the same or rise. Therefore, stock returns through expanding P/E ratios will prove elusive.

Instead, the book puts the focus on those companies which return value to shareholders. The authors define shareholder yield as the use of free cash flow to return value direct through dividends, buybacks, and debt reduction; or the return of value using indirect means through the rational use of capital. In the author’s opinion those companies which achieve the greatest shareholder yield will do best in the near future.

While one can argue with the book’s premise, that premise deserves consideration. After all, if a corporation exists to benefit shareholders, what better why to demonstrate the commitment to shareholders than through the rational use of the free cash flow in a manner which provides the greatest yield to shareholders? The book’s pointed discussion of this topic makes it attractive to the new investor hoping to develop a model to assist in evaluating companies as suitable investments.


The Good News

A thought provoking book which presents to the new investor a paradigm in which to perform security analysis.


The Bad News

The appendix provides various mathematical formulas which allow for a study of the quantitative model discussed in the book. While appreciated, those not proficient in statistical study may desire something simpler.


The Bottom Line

Written in a clear manner and to the point, this 150 page volume earns a place as one of the better books I have read. I recommend it for the investor looking to understand more about security analysis using shareholder yield.


Other Related Reading:

My ReviewMy ReviewMy Review

Blog Review: Update On The Trading Goddess

Value Blog Review has discovered the secret of the Trading Goddess' success as a high powered female trader in a male dominated arena. Those secrets are detailed in this new book:


The Corporate Dominatrix: Six Roles to Play to Get Your Way at Work





When asked to comment the Trading Goddess had this too say:

"There are many keys to success. Warren Buffett says the secret to success is not to forget that 'rule # 1 is don't lose money'. I on the other hand attribute my own success as a corporate dominatrix to an entirely different set of rules...starting with my own rule # 1...you can hurt them, but never leave any marks."

Online Trading - Book Review

SFO Personal Investor Series: Online Trading





What Is It About?

This book collects several articles on online trading from Stocks, Futures, & Options Magazine. This anthology contains articles from such trading luminaries as Linda Bradford Raschke, John Carter, Thomas Bulkowski, and Lawrence McMillan. The topics covered include understanding online trading, evaluating market opportunities, trading with a system, and an introduction to options trading.


What Did I Get Out Of It As A New Investor?

A solid overview on what it means to trade online. The editor of the book assembles the best articles to appear in the Stocks, Futures, & Options Magazine magazine in order to walk the new trader through the process of understanding how to trade online. Most if not all of my trading will take place online. This book helps understand what that means.

From taking advantage of opportunities in the market online to understanding how to begin to develop a trading system the book provides an introductory overview to many of the common themes online traders face. All the articles provide answers to the common questions new traders have about online trading. In short the book provides material most helpful to new traders wanting to learn online trading.


The Good News

Overall, a helpful book for a new trader looking for a basic introduction to issues regarding online trading.


The Bad News

While the book assembles many great articles into book form, which may have appeal to the experienced trader, it may have limited appeal to those who have moved beyond the introductory stage of online trading.


The Bottom Line

A solid informative book for the new trader looking for a comprehensive overview.


Other Related Reading:

      My Review

Stock Screen: Solid Dividends

I collected a lot of stock screens this past year. Most use the free deluxe screener available at the MSN Money website. The screens are sometimes hard to find on the MSN website, so I thought I would share them.

This is a screen that finds high-dividend candidates with good prospects for increasing their payouts:

Current Dividend Yield >= 4.25

Latest Dividend Rate >= 0.25

Last Price >= 15

Fundamental Grade >= C

Market Capitalization >= 1,000,000,000

Mean Recommendation >= Moderate Buy

Return on Equity >= 8

EPS Growth Next 5-Years >= 8

Technical Grade >= C

Here is a link to the MSN article by Harry Domash with a description of how and why the above parameters are used.

Brett Steenbarger's TraderFeed - Blog Review

Traderfeed

An excellent blog that I have read for months now is Brett Steenbarger's Traderfeed. At first glance the blog may appear to concentrate on the trading style of investing with a focus on a short time frame. But a close reading of the blog over several weeks disabuses one of that thought. Why? Because what Mr. Steenbarger discusses on his blog has universal application to all market participants. One must simply filter out the short term discussions to reach the deeper meaning of the material presented.

It simply does not matter where one is on the investing spectrum, the content available at Traderfeed assists all market participants. How can one blog do this? By discussing and focusing on the only element common in all forms of investing: human psychology. Across all time frames and applicable to all styles it is You which must be harnessed for market success. Exploring and understanding your competencies and limitations reigns paramount above all else. That is what the Traderfeed is all about.

That is why, in my opinion, Traderfeed is one of the most important blogs a new investor or trader reads.

Traderfeed

Resource Review: Trader Mike On Position Sizing

Trader Mike On Position Sizing

As many of you know, the Trader Mike blog is one of my top five blogs. It is also a great resource for new traders.

One of the best articles I have found on Trader Mike's blog is his great post on position sizing. Not only does Trader Mike do a great job of explaining why position sizing is important to a trader, he also provides several great links to other websites that will help anyone struggling with the concept. In addition, as does Chris Perruna, Trader Mike also provides a link to his position sizing spreadsheet.

Those unfamiliar with position sizing will be well served to take a look at what Trader Mike has to say on position sizing.

Trader Mike On Position Sizing

Investing Resource Review: Dividend Discount Model

Dividend Discount Model

A website that I like to use is Dividend Discount Model.

As stated on the main page Dividend Discount Model "gives you access to the popular Dividend Discount Model (DDM) used to value publicly traded stocks. DDM calculates the present value of the future dividends that a company is expected to pay its shareholders. DDM can also calculate the expected return implied by the current dividend yield and projected dividend growth."

Dividend Discount Model is very simple to use and has a lot of great information for the new investor who would like to incorporate dividends into a value analysis.

Dividend Discount Model

John Bogle's Little Book of Common Sense Investing - Book Review

The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns





What Is It About?

This book is about investing in businesses rather than stocks. The book demonstrates that for most investors purchasing an index fund guarantees the best stock market success. By using simple math and common sense John Bogle demonstrates that, for most investors, an index fund will result in higher returns than the same investment in an actively managed fund.


What Did I Get Out Of It As A New Investor?

This is the first investing book a new investor should read.

Whether you decide to invest in mutual funds or manage your own portfolio of individual stocks, understanding the power of index investing becomes the most important thing for any new investor. Why? Understanding that most investors will have better success by purchasing an index fund can serve to ground one's expectations of just how much value they can add by managing their own portfolio.

Before I begin to describe what Mr. Bogle does say in his book I would like to address what he does not say. Mr. Bogle does not state anywhere in his book that a motivated individual willing to dedicate a sufficient amount of time and effort cannot achieve above market returns. Therefore, this book does not reject the premise that an enterprising investor or trader may have the ability to beat the market.

Mr. Bogle does say that if you have a choice between investing in a managed mutual fund or an index fund, choose an index fund because not only will the managed fund risk under performing the market, the mutual fund investor must overcome the fees charged by the mutual fund (i.e., management fees, transaction fees, and taxes) which will eat away returns such that the mutual fund will not beat the index. In other words, why take the risk of figuring out which fund manager to choose, which mutual fund to choose, which style to choose, and what fees to pay, when you are better off in a total market index.

That's it. That is all Mr. Bogle says. He does not, anywhere in the book, say that a focused (or enterprising) investor who is willing to invest the time should index. He simply agrees with what Warren Buffett says "the know nothing investor can actually out perform most investment professionals" by investing in an index fund.

In making this point Mr. Bogle looked at the 36 year period from 1970-2006. At the start of 1970 there were 355 equity funds. By 2006, only three out of the original 355 funds beat the index consistently over the 36 year period. Clearly, the investor with a multi-decade horizon should accept the return of the index fund.

With respect to the investor who desires to manage his own account, this is the best of the three books in the “Little Book” series. Why? The book sets the baseline for the new investor. You can buy the U.S./Intl total market index and know that you will do no better or worse than what businesses will do over time.

Indexing requires little or no effort and about $10-20 per year for every $10,000 invested. Compare that to a mutual fund that charges $100-300+ year after year for every $10,000 invested with no guarantee that it will beat the index fund. By making this point the book shows a new investor a way to participate in the market with little effort and do as well as the best money managers over the long term. For those who must choose between mutual funds and index funds, this book makes obvious the path to take.

For the investor who desires to manage his own account the book tells a scary tale. Again, Mr. Bogle never says that one cannot beat the market or in anyway disparages those who have found success. He does not have to. Over and over Mr. Bogle, using simple math, demonstrates the relentless nature of a total stock market index. The index never rests and will not make mistakes. You will do all those things.

Consequently, in order to beat the index one must obtain above average results. Yet the fact is we can't all achieve above average results. A few will, most will not, and a lot will just end up matching it – but, with a lot of wasted effort and unneeded stress when they simply could have bought the index and spent the time saved with their family.

This book makes you take a close look and ask yourself whether you have what it takes to beat the index when so many others do not. Depending on your investment style will you spend hours and hours reading annual reports, thinking about businesses, thinking about the market, studying charts, or developing trading systems? Will you do this year after year with the knowledge that so few do it successfully? Will you have the necessary emotional control to maintain a consistent approach no matter how negative the short term results? If the answer is anything less than an unqualified affirmative, the book demonstrates that perhaps indexing is for you.

Overall, the book does not say individual investing has no utility. The book just uses simple math to show that the odds of you (or anyone else) practicing it in a manner which will allow you to beat the index weigh against you. That is why Mr. Bogle’s book is so good; it forces one to confront reality and assess whether to make the commitment necessary to succeed against an index fund.


The Good News

An outstanding book because it forces all investors to honestly question whether they or anyone else has what it takes to beat the index.


The Bad News

If you use “Maverick” as a nickname and think index funds are for widows and orphans, you probably won't get much out of this book.


The Bottom Line

A must read because the book provides sobering advice to a new investor on the merits of index investing as compared to active portfolio management..


Other Related Reading:

 My Review   My Review

John Chow Dot Com - Blog Review

As many of you know, one of the things I do here on this blog is review other blogs. I do it free of charge. But I have recently discovered that what I do may have some value other than receiving an appreciative thank you from the author of the blog I reviewed. An interesting blog that I have come across that demonstrates the power of saying nice things about another website is John Chow Dot Com.

John Chow is a self described dot com mogul and founder of The Tech Zone. The John Chow Dot Com blog covers many topics including John Chow on Technology, John Chow on the Net, John Chow on How to Use Wordpress, and of course the category that caught my eye, John Chow on Investing.

In the category of Investing, John Chow discusses such topics as: flipping real estate for profit, tips to maximize your RRSP, the impact of tax on investment income, the mutual fund scam, the greater fool theory, and the gun and butter theory. All of these posts provide solid information on the topics covered.

Currently the subject that the John Chow Dot Com blog covers most often now is how to make money online. Covering such topics as commenting your way to the top, hiding affiliate links for better seo, the importance of deep linking, and using other advertising networks besides google adsense the John Chow Dot Com blog shows you how to monetize your blog if that's what you want to do.

In fact what really gets me is that John Chow gets $250 to review other websites and blogs. As an example for the month of March the John Chow Dot Com blog has already done well over a dozen reviewme reviews at $250 a pop. And here I was happy to get a free book now and then when I did a review. Silly me. LOL.

Of course reviews are not all that the John Chow Dot Com does. John Chow also accepts other kinds of placements to advertise his blog. How much does this all add up to?

On his blog John Chow details how much money he makes from the John Chow Dot Com blog. While John Chow states that he never started John Chow dot Com to make money, he has done just that. How much money? In the last several months the earnings from his blog have been quite good.

For October 2006, John Chow made $1,361.64 with his blog; for November 2006, John Chow made $2,139.93 with his blog; for December 2006, John Chow made $2,790.05 with his blog; for January 2007, John Chow made $3,440.66 with his blog; and in February 2007, John Chow made $7,011.05 with his blog. Not bad.

The thing about John Chow is that not only does he discuss how well he is doing, but he also takes the time to help out new bloggers by offering them a link on his blog if they do a blog review of his John Chow Dot Com blog. Some other websites that get a lot of traffic are pretty stingy with their links, but not John Chow.

John Chow has also done some nice things with raising money to help feed the hungry this Easter by raising over $1000 for the Union Gospel Mission. Since John Chow seems to be of a giving nature I think I will do something for his readers.

Last month John Chow had a contest where he asked his readers to "guess my February blog income" and gave away a free watch for the closest guess. Therefore, in March I will give away a copy of Kenneth Fisher's "The Only Three Questions That Count: Investing by Knowing What Others Don't" to the person who comes closest to guessing what John Chow's blog income is in the month of March 2007 from his John Chow Dot Com. To see what the book is about you can read my review of Ken Fishers' book.

Here are the rules:

1. All entries should be left as a comment to this post no later than 11:00 p.m. PST on March 25, 2007.

2. Closest to the actual earnings for March 2007 (over/under) wins the book.

Good Luck.