I have not been a market watcher my entire life, and in many ways I am still relatively new at managing my own money. I pay attention, do my homework and listen to smart people, and then make my own decision.That's quite different from when I was in my playing days. Back then, I let my money manager make a lot of decisions for me. I thought that was the way it was supposed to work, and I really didn't have to do a whole heck of a lot except keep pulling down those passes and bringing home those paychecks. When I was playing, I left my finances, to a large extent, to the pros. Only later did I realize that I could handle certain parts of my portfolio myself. Now, don't get me wrong, I'm not recommending a mass exodus from brokers or advocating that everyone manage all of their own money. That could be a disaster, especially if you don't have the time to do your own research and make truly informed decisions. I wouldn't try to play one of the best teams in the league without ever opening the playbook, and I wouldn't gamble away my money by not doing my research before plunking down my hard-earned cash. Winging it will get you in deep trouble. When you do that, you make decisions after only seeing a fraction of the picture. Now, for me, getting started was fun. I took a small amount and watched some stocks. I listened to people on TV. I read The Wall Street Journal and TheStreet.com and other great finance news sites. I paid attention to the way the market affected the stocks I was following, and I talked to my friends about my investment ideas.
Some were good. Some were garbage. I displayed flashes of greatness but also made a lot of rookie mistakes. Since then, I have refined my process. I look at a company's fundamentals and try to pick those I am not only familiar with and can get information on rather easily, but those whose products I like (for the most part). Today, Wal-Mart ( WMT) has caught my eye. It weathered the storm the last few weeks very well, and although it is down a bit today while the market is getting clobbered, I still like it. Wal-Mart sells everything, and people go there out of habit. The company has good metrics and solid books. It has $6.91 billion in the bank and $24.14 billion in operating cash flow. It has a return on equity at a sizable 20.75% and a forward price-to-earnings ratio of 15.22, which is right on the border of being undervalued in my mind. Overall, given its performance today and its price -- trading down $1.00 at $58.65 in afternoon trading -- the company has "buy" written all over it. I definitely believe this is a steady company to invest in during tumultuous times. Keep moving the chains!