If you’re new here, you may want to subscribe to my RSS feed. Thanks for visiting!Stupid in Small I once heard a story of Warren Buffett playing golf with Bill Gates and their group of friends, not sure if it is a true story, but I found the story behind it very powerful. And also, personally I don’t play Golf so please pardon me if certain terminology is inaccurate. The …
Read MoreWhy I don’t follow the Financial News?
Why I don’t follow the Financial News? Personally, I do not follow the financial news. I won’t know that the market had crashed until a friend tells me. I remembered that Warren Buffett’s teacher, Benjamin Graham once telling him to look at the stock market as a partner named, Mr Market. He also mentioned that Mr Market is a great partner, but is a lousy advisor. Mr Market had mood …
Read MoreThe 4 steps of Stock Investing
The 4 Steps of Stock Investing Whenever friends ask me what stocks to buy? I will answer that if I tell them “what stocks to buy” is only 1 step out of the 4 steps of the investing process and it will not be complete unless I show them the entire 4 steps. Lets take a look at the 4 steps A-B-C-D stock investment process: A – Assess: Going …
Read MoreInvestment in Stocks
Investment in Stocks We all need to invest and I love to invest in various investments. Some of the investment vehicles could be: 1) Stock 2) Bonds 3) Mutual Funds 4) Real Estate 5) Land Banking 6) Precious Metals 7) Collectibles 8) Small Businesses Of all these, I love the stock market for these reasons: 1) Small Capital Outlay You need not have huge capital to start stock investments. …
Read MoreUnderstanding Financial Health of a Company
Understanding Financial Health of a Company In dissecting a business to check its “health”, we make use of the 3 Financial Statements: Balance Sheet Income Statement Cash Flow In this post, we will look into the balance sheet: The Balance Sheet The Balance Sheet is a financial statement that summarizes a company’s assets, liabilities and shareholders’ equity at a specific point in time. These three balance sheet segments give investors an idea as …
Read MoreCompound Your Way to Financial Freedom
Compound Your Way to Financial Freedom So, how does Value Investing help us achieve Financial Freedom? Let me give you an illustration. We assume that Charles is going to win the Money Game and achieve financial freedom solely by Employing his Money to work for him. Charles monthly basic need is $2,500, so he must employ his money in a way that gives him $2,500 a month. Through Afterthe reading …
Read MoreThe 4 Question Check List
The 4 Question Check List There is some probing questions you can ask when faced with a company you suspect has a competitive advantage Q1: What is the Value the business is providing? Lets take for example we talk about KFC. The value is yummy chicken. We then move on to the next question. Q2: Can you get it else where? The answer is yes to this question. …
Read MoreCompetitive Advantage Part 2
Competitive Advantage Part 2 In the last post about competitive advantage we looked at the first 2 ways which a company can build an economic moat. Today let’s explore the other 3 ways: Low Costs or Prices Offering the same or similar product or service at a lower price can be a powerful economic moat, especially in commodity industries. Airlines and PCs are a couple of commodity industries. Cost advantages …
Read MoreCompetitive Advantage Part 1
Competitive Advantage Part 1 In general there are 5 ways for a company to build a competitive advantage over its peers. Warren Buffet calls this competitive advantage as “economic moat”. An economic moat is the ability of the company to keep its competitors at bay from hurting its profits. The wider the moat, the longer the company can protect its profits. The deeper the moat, the more profitable is the …
Read MorePrinciples of Value Investing
Principles of Value Investing Value investing begins by asking the right questions when deciding whether to put your money into the stock market. Most people go for short term gain without any fundamental strategies. You can tell by the questions they ask which ultimately affects their decisions. They ask things like which stock is going to fly or take brokers’ recommendations. They do not do their own study because they …
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