1. Warren Buffet says that the best investment course would teach just two things well: How to value an investment and how to think about market price movements.
2. Value Investors buy stocks out of the conviction that the current value is high relative to the current price
3. Growth Investors buy stocks because they believe the value will grow fast enough in the future to produce substantial appreciation
4. (2) and (3) implies that the choice isn't really between value today and value tomorrow. Growth investing represents a bet on company performance that may or may not materialize in the future, while value investing is based primarily on analysis of a company's current worth
5. Joel Greenblatt - One of Buffet's major contribution has been to extend the idea of value beyond the simply "cheap". Buffet looks for "good" businesses that are available at an attractive price. The concept of growth is incorporated into the calculation of value
6. Growth stock portfolios are heavily weighted towards drug, technology and consumer products.
7. The upside potential for being right about growth is more dramatic, and the upside potential for being right about value is more consistent. Value is my approach. Consistency trumps drama
8. If you do a good job valuing a stock, I guarantee that the market will agree with you. It could be years or weeks. Graham said that the market is a "weighing machine" over the long term, even if it is often emotional over the short term.
9. Investors with no knowledge of profits, dividends, valuation or the conduct of business simply cannot possess the resolve needed to do the right thing at the right time. With everyone needed to do the right thing at the right time. With everyone around them buying and making money, they cant know when a stock is too high and therefore resist joining in. And with a market in free fall, they cant possibly have the confidence needed to hold or buy at severely reduced prices.
2. Value Investors buy stocks out of the conviction that the current value is high relative to the current price
3. Growth Investors buy stocks because they believe the value will grow fast enough in the future to produce substantial appreciation
4. (2) and (3) implies that the choice isn't really between value today and value tomorrow. Growth investing represents a bet on company performance that may or may not materialize in the future, while value investing is based primarily on analysis of a company's current worth
5. Joel Greenblatt - One of Buffet's major contribution has been to extend the idea of value beyond the simply "cheap". Buffet looks for "good" businesses that are available at an attractive price. The concept of growth is incorporated into the calculation of value
6. Growth stock portfolios are heavily weighted towards drug, technology and consumer products.
7. The upside potential for being right about growth is more dramatic, and the upside potential for being right about value is more consistent. Value is my approach. Consistency trumps drama
8. If you do a good job valuing a stock, I guarantee that the market will agree with you. It could be years or weeks. Graham said that the market is a "weighing machine" over the long term, even if it is often emotional over the short term.
9. Investors with no knowledge of profits, dividends, valuation or the conduct of business simply cannot possess the resolve needed to do the right thing at the right time. With everyone needed to do the right thing at the right time. With everyone around them buying and making money, they cant know when a stock is too high and therefore resist joining in. And with a market in free fall, they cant possibly have the confidence needed to hold or buy at severely reduced prices.