Revisiting the Templeton Trade

The clan gathered at Chez Melvin last evening for a little wine and cake in celebration of the old man getting older. It was a gorgeous night, so we sat out on the patio enjoying some conversation and my son and I got onto the subject of stocks and the stock market. I am teaching him how to use some basic value techniques and to focus on long shots that can offer dramatic returns over time. He is young enough that he can be much more aggressive in his approach to the markets and focus more on distressed equities with the potential for recovery.

During our conversation, I told him one of my favorite stock market stories. Sir John Templeton borrowed $10,000 before World War II and bought every stock under $1 on the NYSE. Over the next four years, the portfolio of cheap stocks quadrupled in value. It was the beginning of his fortune and spectacular investing career....626 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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