Distill Wisdoms, One Idea at a Time.
The majority of your money is best invested in safe, low-cost index funds.
Actively managed funds suck, because past profits don’t guarantee future success.
Browne likes simple businesses where there is ongoing demand for its products and services.
When quarterly earnings of a stock fail to meet analyst expectations, investors sometimes panic and dump their shares.
Browne uses a three-legged value stool that consists of the price-to-book (P/B) ratio, price-to-earnings (P/E) ratio, and the appraisal method to measure the intrinsic value of a stock.
Be a contrarian, buy those stocks or sectors which are not tracked or hyped or even researched by the media and other financial players, still following the rules of value investing.
Diversify your portfolio, do not put all your eggs in one basket, to minimize risk and also to capture other opportunists.
Buy Stocks selling at two-thirds of their intrinsic value. This is to mitigate any error of judgment in intrinsic value and non-performance of the company.
Buy stocks like you buy everything else, when they are on sale.
Buying stocks for less than they are worth and selling them as they approach their true worth is at the heart of value investing.
Value investors are like farmers. They plant seeds and wait for the crops to grow.
If you cannot understand the income statement of a company, just walk away from it.
Diversification provides a margin of safety and insurance against downturn in a few stocks/industries.
Avoid investing in companies that have a lot of debt relative to theirnet worth.
First rule of investing: Don’t lose money. Second rule of investing: Refer to rule number one.
