AGREE THE DISAGREE, DISAGREE THE AGREE

AGREE THE DISAGREE, DISAGREE THE AGREE

                As a value investor, act against the flock has been one of its most essential skills.

 The common adage of a value investor will always be buy low, sell high. However, in order to do so that value investor needs to have crystal clear view on the intrinsic value of that particular share and psychologically calm and confident to executive such action plan.

Perhaps due to the biological instinct, follow the flock will generally give a sense of security a particular person (although the facts frequently proved the otherwise is true).

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As Howard Marks points out: the piece of information that everyone knows is worthless. Value investor has their own unique notion that the general population don’t aware of. The value investor then has to convince themselves that their notion is correct based on the fundamental facts. The value investor therefore owns the undervalued stock earlier than the crowd and thus enjoys the capital appreciation better than the crowd.

孙子兵法曰：先入战地者逸。

The contemplating process doesn’t stop there as the value investor has to constantly evaluate the fundamental elements (not stock price or humors and neither does some prominent bought or sold the stock). When the conditions differ from what is perceived before then the sell button should be considered (this simple maneuver doesn’t apply to marriage).

The fundamental elements to be evaluated will always be the microeconomics of that particular business (not macroeconomic). Perhaps this process is easier than the attempt to understand women’s thinking.

Nevertheless, I believe that understanding owns psychological characteristics and strength and weakness is also paramount while deciding the business and stock you want to invest.

The sharing of stock information from others maybe altruistic but you should keep this in your mind:

The share you bought is like your own wife, you will be the one who get all the benefits (and hopefully no cons, and I assume no logical people will share their wife with other man).

Recommended books for new value investor:

1.       Warren Buffett Way by Robert G. Hagstrom

2.       The Intelligent Investor by Benjamin Graham

3.       Security Analaysis by Benjamin Graham

4.       Any accounting book or course that you found interesting.

LASTLY, I urge you to help others that need our help. Do donate those who need our help (2.6 billion ringgit is not a donation).

                                                                                         

                                                                                                                

INVESTMENT IS MOST INTELLIGENT WHEN IT IS MOST BUSINESS LIKE-- Benjamin Graham

Contemplator

13/5/2016

THIS IS AN ORIGINAL ARTICLE :)

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