What are
/r/ValueInvesting's
favorite Products & Services?
From 3.5 billion Reddit comments
The most popular Products mentioned in /r/ValueInvesting:
The most popular Services mentioned in /r/ValueInvesting:
finbox
The Motley Fool
Schwab
wallmine
eToro
Seeking Alpha
Vercel
G2
Yahoo! Search
Notion
Yuzu
Notability
DocDroid
Bypass Paywalls
Four Minute Books
The most popular reviews in /r/ValueInvesting:
https://www.amazon.ca/Benjamin-Grahams-Net-Net-Stock-Strategy/dp/085719707X
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This is the book that I now base my cigar butt investing around. Its so far the most comprehensive guide for how to implement a cigar butt strategy, how it works, and why it works. It is a contrarian investment style and my portfolio at a glace looks like a sack of junk but instead of a tumultuous portfolio as is the market currently, its just been steadily growing and I'm up 9% YTD. I would recommend.
I would consider picking up a copy of Warren Buffett and the Interpretation of Financial Statements to get a hang of financial statement terminology in general (even outside of just DCF.)
Another good resource I used were courses from Pareto Labs.
PE and PB are IMO still a bit high relative to the history. I think the stock can drop even further. I would be more comfortable to buy it at around $525. See https://finbox.com/NYSE:SAM/models/pb-multiples for a quick valuation.
Pat Dorsey - The Five Rules for Successful Stock Investing: Morningstar's Guide to Building Wealth and Winning in the Market
Good tips on analysis including how to evaluate sustainable competitive advantages (moats).
Gives examples of how to look at various industries.
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Heather Brilliant - Why Moats Matter
She took over where Dorsey left off. Literally & figuratively.
The investopedia article is as good a place as any.
https://www.investopedia.com/articles/trading/05/020305.asp
Charles Schwab has a pretty good monthly column I like to follow
https://www.schwab.com/resource-center/insights/section/sector-views
That said, none of it really falls under the umbrella of Value investing, which generally believes in investing in companies long term. That said, I devote 10% of my portfolio on sector rotation, right now betting energy and healthcare will have a good run. But my portfolio beat SPY by .06% today, so what do I know.
I think copying portfolios is not a crazy idea. Many social investing platforms work with this approach. I have been using "eToro" since 2013, in this platform you can actually copy portfolios of other investors.
I think this is a very good idea for people who is new or doesn't have the time to do all the necessary analysis for investments. You can basically copy as many people as you want and let them do the work. I currently have around 2.5K people copying my portfolio. I expend most of my day working on analysis and copiers automatically get the same results as I do, without investing the time. I believe this is a game changer for personal finance.
I'm slightly more bulish. My DCF model puts at the stock at 388$, FinBox at 428$ (https://finbox.com/NYSE:LMT/models/dcf-revenue-exit-5yr) and StockAnalysis at 413.35$ (https://stockanalysis.com/stocks/LMT/). On average I find the average/median upside ~20%. Maybe if it drops another 5-10% $LMT would be a good buy.
"The Little Book on Valuation" by AD is a good read. It's only $15 right now too...
https://smile.amazon.com/Little-Book-Valuation-Company-Profit/dp/1118004779
Read it as many times as it takes to "click" for you.
Intelligent asset allocator: https://www.amazon.com/dp/B005XM6NRY/ . I generally recommend the less mathy version: https://www.amazon.com/gp/product/B0041842TW/ for new investors as their first book.
Nice. Here is one for live PE ratios.
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https://play.google.com/store/apps/details?id=price.earnings.ratio.stock.value.tracker
> First, I was using cash to be "cash and cash equivalents", but by that definition, as soon as the company purchases inventory, their value goes down - which doesnt make sense.
This is not right. When a company purchases inventory, cash decreases, but assets increase (in your formula, it will be reflected in the present value). Considering that you expect inventory to be sold as a profit, the present value may be higher than the cash you’ve spent. Value was actually created.
+1 on Damodaran’s course. Alternatively, but the Valuation manual. It’s not a terrible read, and it’s super useful.
I’m a fan of the Second Edition. The 6th edition seems pretty adulterated from what I’ve seen. The Second Edition which is also Buffett’s favorite edition for what that’s worth. It’s a book about finance, if you’re expecting a page turning thriller you’ll be disappointed.
The book is still applicable; the people who say it isn’t anymore haven’t read it. Security Analysis is the seminal text in Value Investing and it is pretty much the touchstone from which all other value investing methods and philosophies are based. Some of the math is off and you’ll have a hard time finding Graham style cigar butt stocks in developed markets. That being said the ideas laid out in Security Analysis are unmatched in any other investing book.
I read some reviews about Security Analysis a while back and some of them indicated that the book was “dry” and “hard to follow”. Do you agree?
This book was written some time ago(2008 I think for the updated version), other than the basic concepts, how much of it actually applies to today’s market, strategy, calculations, etc.?
Also, I thought Intelligent Investor was like the updates version of Security Analysis. It doesn’t sound like it is.
I haven’t read Common Stocks and Uncommon profits yet but it has been added to my list.
Finally check this link and let me know if this is the version you are talking about.
Found this, 1965 thru 2014.
https://www.amazon.com/Berkshire-Hathaway-Letters-Shareholders-Buffett/dp/0615975070/
I enjoyed "The Myth of the Rational Market". It reads more like a history of efficient market and portfolio theory, and the various schools and scholars that took different approaches to the theories. Might be a little dry for some, but I think there are lessons to be learned in there.
Of course some of the ones mentioned already:
All of the Peter Lynch books. He is too folksy for some, but simple, down to earth, and some very good non quantitative insights.
Both of the famous Graham books. I read Security Analysis when I was 19, you can too. It really isn't that complex.
Essays of Warren Buffett: Lessons for Corporate America is a nice compilation of some of his best letters to shareholders.
One of the first books I read was "The Warren Buffett Way" and then "Buffetology", I know there are bunch more. As much as you can learn about Warren and his outlook and ideas, not just on investing, will be worth it.
While it is not really a book, the free classroom modules on Morningstar are an excellent place to start if you are a begginer and want to start analyzing companies.
Also not a book, but if you want to see and read the ideas of some of the best minds in investing get a guest membership to valueinvestorsclub.com
Cadence is for semiconductor and electronics design. AutoCAD is for the design of electrical systems of buildings, airfields, etc.
Switching cost, by definition, means the potential for lost business, additional training time, etc. This product qualifies for serioous switching costs on both counts.
It sounds like you're interested in learning. I'd like to point you to a book about how to identify strategic competitive advantages. I found it to be invaluable.
You have read a lot of good books on valuation. Four Pillars of Investing is the only one on that list on portfolio design and it is fairly easy. I think what you are missing more advanced books or works on portfolio design. Also you have nothing on fixed income, options, trusts, how to spend down your portfolio. I have no idea which of these topics are of interest. But since it appears you do stocks and this is 2022 options would be my next book. A very good basic options book: https://www.amazon.com/Unlucky-Investors-Guide-Options-Trading/dp/1119882656
I have read pretty much all the books you listed, but one book which really furthered my understanding of valuation and analysis by orders of magnitude is Penman’s Financial Statement Analysis and Security Valuation.
https://www.amazon.com/Financial-Statement-Analysis-Security-Valuation/dp/B00DO8UV0Y
It is incredibly thorough and requires sacrifices and dedication, but this book gives you a framework to analyse the business like no other.
Highly recommended!
Berkshire letters.
https://www.amazon.com/Berkshire-Hathaway-Letters-Shareholders-Buffett/dp/0615975070
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You can get the latest ones from their website, but I had to buy this book to get the first several years.
https://www.amazon.com/Intelligent-Asset-Allocator-Portfolio-Maximize-ebook/dp/B005XM6NRY/ was written to be a first book on MPT. It will walk you through the basics on the math and how to do it with a spreadsheet by hand. It won't discuss alternatives much but it will at least give you the foundation to then read a more hardcore book on modeling, synthetics...
A spreadsheet to identify strategic competitive advantages?
I found these 2 books very helpful.
As far as MOS goes, Marks suits my style and temperament.
If you want to read about evaluating the qualitative & quantitative aspects of businesses, I recommend Pat Dorsey's Five Rules for Successful Stock Investing
Dorsey was instrumental in developing Morningstar's MOAT ratings and he discusses how to look at strategic competitve advantages across various industries. I liked this book a lot.
His successor was Heather Brilliant, and she wrote a very good follow up called Why Moats Matter
Both of these books will made me start looking at businesses in a very different way. They are geared towards long term investors. Most MOMO day traders will not make it past the 1st chapter.
I would like to add the book "Richer, Wiser, Happier" by William Green as a must read for beginners like me.
It was released in 2021 and it delves into the mindset of Charlie Munger, Nick Sleep, Monish Pabrai and many other successful investors. Very well written and it flows easily.
Here is a link (if this works...) Rational Thinking and Investing
You will then want to click to "buy" the kindle version for $0.00. Don't try to read it through Kindle unlimited (unless you are already signed up for that) - that is a subscription service to read unlimited books through Amazon, and that's not necessary for this.
A book that helped me that I don't see recommended as often as Warren Buffett and the Interpretation of Financial Statements
It's written by Warren's daughter-in-law. To summarize the book, it goes through almost everything you'd find on a balance sheet, income statement, and cash flow statement. What I like about this book is she'll point to specific examples of what Warren did and why he did it.
For example, the company Wrigley (makes gum) was seen as a good investment by Warren because of the low R&D expenses. While tech companies need to keep innovating, Wrigley's been making the same gum for decades. Not as much of a need to innovate. He also liked them for their moat.
All the other suggestions are great as well. But this book really holds your hand in some parts. Which I honestly needed.
Those benchmarks on the Hynix are mostly under 7 Gb/sec. The max read is 7 Gb/sec, but max write is 6.5 Gb/sec. The Crystal Diskmark writes get up to 6.9 Gb/sec, which seems weird given its not rated to write that fast. Then the other benchmarks seem all over the map, none near 7 Gb/sec.
And one difference is the Hynix doesn't have a heat-sync, it's not made for laptops. Apples fast SSDs are in the 14 and 16 inch MacBook Pros.
And turns out the only Mac models that achieve 7.4 Gb/sec use 8 Tb SSDs (likely due to more lanes to read/write from). So I don't know what they are using, but maybe something like this with a heat sync (if they make an 8 tb version)?
2nd edition. This one https://www.amazon.com/gp/product/0470116730/ref=ppx_yo_dt_b_search_asin_title?ie=UTF8&psc=1
So good.
I recently read https://www.amazon.com/Investing-Banks-Strategies-Statistics-2016-04-12/dp/B01LP81EVO and enjoyed it. It comes with a lot of statistical data to back up what to look for when investing in banks.
I asked the same question a while ago but got few decent responses. I asked this to the head of finance department at my university and he recommended this two books. I still haven’t bought them since I got the response today morning but hopefully they are good.
https://www.amazon.ca/Financial-Markets-Institutions-Saunders-Professor/dp/0077861663
$3,750 is a LOT of money for a course on value investing. I would think twice before parting with my money.
There's a book called Value Investing: From Graham to Buffett and Beyond by Bruce Greenwald who's a professor of Finance/Value Investing at Columbia. This book covers almost the same material (with some of the same case studies) and costs $35.
I don't think it's worth spending a hundred times that amount for a course unless you believe you will gain a lot from your peer group and faculty interactions.
If I were going to start I'd start on a book on asset allocation. I think top down is more important than bottom up. You can very easily outsource the bottom up decisions but you are absolutely forced to make the top down ones. This book works through asset allocation and also teaches you the math (which I assume you like if you are a value investor): https://www.amazon.com/Intelligent-Asset-Allocator-Portfolio-Maximize-ebook/dp/B005XM6NRY/
Correct - price is used as a filter for considering firms in the cheapest earnings (EBIT/EV) decile along with other filters described above -- but the ranking is done based on the composite quality score. They describe their approach in detail in this book.
This book helped me early on. That and an intro class in accounting.
I would not buy it for $40, lol...
There are many YouTube videos that will do a far better job than I ever could of explaining intrinsic value and using a “discount cash flow” (DCF) model than I ever could in a reddit post. Read about buffets methodology. Read what Charlie munger has to say and watch any interviews of these men.
I recommend reading (https://www.amazon.com.au/dp/0857197681/ref=cm_sw_r_cp_api_i_8CB7VJTHEK9MR73GH0XN) first before doing anything.
And then grab some value investing orientated books. Some can be a bit complex. Having read “the intelligent investor” I can say that it’s a bit much for the first timer. Also a bit outdated when compared to buffets evolution and munger’s influence on it
Check out the 8-step Beginner's Guide to Value Investing!
Free if you have a prime account.
The 8-Step Beginner’s Guide to Value Investing: Featuring 20 for 20 - The 20 Best Stocks & ETFs to Buy and Hold for The Next 20 Years: Make Consistent Profits Even in a Bear Market https://www.amazon.com/dp/B08B1NZXYT/ref=cm_sw_r_apan_6H66J34XDV5EV0GCKDC9
If you're just trolling, then you've already got some good answers. If you are seriously interested in value investing, then the best introduction in my opinion is Peter Lynch's book, One Up On Wall Street. Reading this book won't make you a market wizard, but might give you some idea on the merits of the method.
My take on it: yes, you can beat the market. It's not as difficult as some would make you believe. You do need to spend time and effort to learn and practice it. You do need to have a certain attitude and willingness to take risk. I believe the determining factor is whether you enjoy doing it or not. If you do, then you've got a (potentially) profitable hobby. If not, you should probably stick to an index and do something else with your time.
This is easy to read and has lots of good things to look for in a company.
Warren Buffett and the Interpretation of Financial Statements: The Search for the Company with a Durable Competitive Advantage https://www.amazon.com/dp/1416573186/ref=cm_sw_r_cp_api_i_X014X64NBF9ZBZXF4H2P?_encoding=UTF8&psc=1
Read this and tell your grandkids that if we're damaging the Earth in various ways, CO2 is not even remotely our biggest sin:
https://www.amazon.com/Unsettled-Climate-Science-Doesnt-Matters/dp/B0948623S1
This explores Berkshire Hathaway’s complete financial history. There may be some other options out there for Buffet’s earlier investment analyses.
>How much did he lose by buying Berkshire Hathaway, a classic cigar butt?
I believe emotions were involved in keeping Berkshire not an incorrect assessment. It was the turning point for him because up until that point he was akin to a corporate raider. I think I read that in this book: https://www.amazon.com/Deals-Warren-Buffett-First-100m/dp/0857196030
>Buying net-nets can work, but certainly it’s not all there is to value investing
Ok fair enough
>Also, should you make all of Buffett’s mistakes?
Thats why I brought up the fact that he didnt seem to switch till after he was wealthy. Was cigar butt investing really a mistake or just in hindsight after 40 years? He still had to make that first million and many people say its the hardest part.
I've only read half, but everything was pretty beginner friendly so far with breaking down financial statements.
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The Art of Company Valuation and Financial Statement Analysis: A Value Investor's Guide with Real-life Case Studies. Amazon: https://www.amazon.com/Company-Valuation-Financial-Statement-Analysis/dp/1118843096
I actually think is good but jmho. Just look at the amazon reviews https://www.amazon.com/Vita-Coco-Organic-Coconut-Water/dp/B07DJ16CD6?th=1 which out of 17,166 ratings they give it 4.5 stars on average
I agree that FB is very weirdly valued, but the metaverse is far from being a certain cash cow yet. Where as electrification of the entire car industry is inevitable, and Tesla is leading the way IMO
To be on par with Amazon a P/E of 100 seems reasonable IMO. https://finbox.com/NASDAQGS:AMZN/explorer/pe_ltm
2022 100 P/E will give a stock price in the range 900-1200 (depending on what EPS you expect).
He was speaking pre internet though, you can look at all this info via any stock screener, I like macro trends.
My favorite book is One Up On Wall Street. It is a shame I didn't read this $13 book 20 years earlier. Peter keeps things simpler than Graham does, but does a better job of explaining to me the power of earnings growth.
I’ll have to calculate it myself based on their report then. Yahoo finance has it at 54: https://search.yahoo.com/search?p=%24doyu&fr=yfp-hrmob-s&fr2=p%3Afp%2Cm%3Asa&.tsrc=yfp-hrmob-s&fp=1&toggle=1&cop=mss&ei=UTF-8 just so I know I’m not going crazy haha. Thanks for the explanation, though, much appreciated.
Really surprised you don't have Greenblatt's book The Little Book That Still Beats The Market (updated version from the original).
It's a staple for value investing and it's really an amazing easy to follow/read book for people who are not in to investing. A fairly quick read and really puts some broader concepts into perspective that some have difficulty with like how much things "costs".
You should have a list of diaries from bull and bear markets.
- 1929 / Great Depression: The Great Depression: A Diary
- 1972 / '70s Bear: Kiplinger's Magazine - Diary of a Bear Market
- 2008 / Great Recession: When Decades Became Days: Notes from a Princeton Dorm Room
The book is The Rediscovered Benjamin Graham by Janet Lowe. She put together a bunch of his less known interviews and writings.
https://www.amazon.com/Rediscovered-Benjamin-Graham-Selected-Writings/dp/0471244724
Uh how is an intelligent investor by Benjamin Graham not here? If you get a revised edition skip all those NY times assholes additions.
If you want to go deep Security Analysis: Sixth Edition, Foreword by Warren Buffett (Security Analysis Prior Editions) https://www.amazon.com/dp/0071592539/ref=cm_sw_r_apan_glt_fabc_1456TSZVXPJNMGNRYANH
Perhaps this book can give you the insight you’re after.
If you want to properly host this, you can use a free web application deployment site like Vercel
You can also make a more robust application and use a backend framework like FastAPI (Python) and a frontend framework like React (Javascript).
I was commenting more based on everything I've read about them for the past few years, and this article confirms my feelings.
Here's another recent, general piece about Weschler and Combs.
I thought I had once posted something more in depth about them than that, but I can't find it now.
I used https://finbox.com/NASDAQGS:FB/models to come up with a fair value of $451.63. IIRC Sven Carlin evaluated at $410. With 15% margin of safety my entry would be $383.88. My current exit price is $541.95 (+20%), but I expect this price to increase over time.
I mean it's based off a well-regarded book on what Buffett screens for - https://www.amazon.com/dp/B00ADMYS3K
It's as close to a detailed account as you'd get
>At last, here is a book that reveals what the public really wants to know about this legendary investor: how he determines where he puts his money. From a team with privileged insight, Mary Buffett, a savvy CEO and Warren Buffett's former daughter-in-law, and David Clarke, a successful portfolio analyst, comes BUFFETTOLOGY, the most detailed explanation ever of the billionaire's unique investment techniques.
Regarding debt workouts and restructurings, take a look at Distress Investing: Principles and Techniques, by Whitman and Diz.
Howard Marks, through his firm Oaktree, is probably the most well known (and successful) distressed investor, and he happens to take a "value" driven approach* to the area. Martin Whitman is cut from a similar cloth and his firm, Third Avenue Management, is likewise among the most successful and well known distressed investment firms.
* I point that out because there are other investing approaches that may be taken to certain distressed situations (mainly in-court restructurings like chapter 11), including by some notable investment firms, that are driven by what might be termed litigation opportunities or arbitrage. This is less about identifying and investing in an undervalued business and corresponding level of its capital structure, and more about, for example, identifying some overlooked feature or ambiguity in the contractual terms governing some part of a distressed company's capital structure, or its relationship to some other part of the capital structure, and then aggressively pressing that position, including through litigation, in order to realize that value. A recent example of that can be seen in the Windstream bankruptcy.
I know someone who averaged 45% for 6 years on microcaps. And Alta Fox has done 85% in small caps over last three years.
Buffett supposedly averaged 80% in arbitrage over 23 years.
https://www.amazon.com/Warren-Buffett-Art-Stock-Arbitrage/dp/B0051BNWLW
The Essays of Warren Buffett: Lessons for Corporate America, Fifth Edition https://www.amazon.com/dp/1531017509/ref=cm_sw_r_cp_api_glt_fabc_J01AMFG96YQEWGBBWAXP
This is a link to the collection I bought off Amazon
This is from Amazon.ca and quoted in Canadian dollars. Depending on where you live you may even find used books in good condition on Amazon.
100 to 1 in the Stock Market: A Distinguished Security Analyst Tells How to Make More of Your Investment Opportunities https://www.amazon.com/dp/1626540292/ref=cm_sw_r_cp_api_glt_fabc_JTH42NF2FTDQ7DPNDQ04
Just get and read this:
https://www.amazon.com/Security-Analysis-Foreword-Buffett-Editions/dp/0071592539
It’s the bedrock of the CFA course and teaches you the key things you need to know to do fundamental analysis of stocks.
Sorry I'm really tired and have other things I have to do, so this is going to have to be a quick and dirty analysis.
Looking at my spreadsheet, I realize I did not look at the Q4 release and only focused on the pro-forma from Q3. Let me try to match them up.
The first three months EBITDA from continuing operations was $34M, and Q4 was $18.5M , thats a big increase. The Q4 rate annualized is $74M, and since we expect to have zero debt we just need to adjust for depreciation and taxes to get net income. I believe depreciation was $8M first three months so about $11M annualized, leaving $63M. Not sure what their tax rates are, but it looks like a $1 a share after tax profit rate.
This isn't too different from what Joel Greenblatt wrote about for spinoffs.
https://www.amazon.com/You-Can-Stock-Market-Genius/dp/0684840073
They transformed the company by getting rid of their Fab, which presumably cut a lot of capital requirements and depreciation. But it takes a few quarters before the shape of NewCo is clearly defined by its financials. You are paying $20 for $4 or $5 in cash, and your stub is then earning a profit that starts at $1 a share annualized, and hopefully grows form there.
Not sure why they keep listing diluted shares in the Q4 release, when I didn't think the conversion had happened yet and won't happen til march (though its clearly gonna happen). Also why is the Q1 guidance so much lower than Q4 sales?
Overall I think its much better than my first look at it led me to believe, but not sure that $50 is a reasonable valuation. But I can see $25+ post distribution depending upon your growth assumptions which is still more than 50% higher than current price.
I’m blanking on specific books other then Buffetology specifically relating to look-through earnings but there is a ton of videos and articles.
Quantitative Value by Wesley Gray and Tobias Carlisle is very interesting
Quantitative Value, + Web Site: A Practitioner's Guide to Automating Intelligent Investment and Eliminating Behavioral Errors https://www.amazon.com/dp/1118328078/ref=cm_sw_r_cp_api_glc_fabc_Apl7FbZMGB9R5
No problem. One more thing I can highly recommend that really switched my mind to this type of thinking is the book "Secrets For Profiting in Bull and Bear Markets" by Stan Weinstein.
https://www.amazon.com/Stan-Weinsteins-Secrets-Profiting-Markets/dp/1556236832
Generally speaking, I don't think investment books are worth reading, but this one is the exception. It was published in 1988, but it's still very relevant today.
I'm not sure a rote adherence to his strategy actually works today, simply because markets move far, far quicker due to computers and AI, but his general philosophy I think can be applied to a similar strategy that would work today, as the underlying motivations and fundamentals of the market have not changed.
Good luck bud.
I made an Android app that implements a simple discounted cashflow model. You can also save your calculations in a watchlist. Here's the link https://play.google.com/store/apps/details?id=com.dynamicdcf.dynamic_dcf Let me know what you think. Thanks
One, I'm not attacking anyone and particularly not the youngsters. I'm trying to speed their progress. I provided plenty of directions on what they should be reading. Go up to my initial comment here. I didn't dismiss Graham completely; instead I suggested people read Zhang first for some proper framework. In particular, his approach is compatible with efficient markets so the premiums are there to be earned by everyone. (More broadly I like to live with an abundance mindset. It's not always zero sum, mi amigo, especially since we are not talking about alpha here.)
You present yourself as a thinking man and professional, but sometimes I wonder if you have a reading comprehension problem or alternatively your reading ability is fine but you are so resistant to the viewpoints of others that you fail to understand them properly before you lash out. I'm no psychologist so I will leave that to your therapist.
Second, go knock yourself out with his lectures (https://www.amazon.com/Feynman-Lectures-Physics-boxed-set/dp/0465023827/) . Not a real test since you are smarter than the average /r/investing bear but give it an honest effort and report back in a month.
Yeah, it will help you get away from this notion that you need to find "bargains" or mispricings. My other top recommendation is The End of Accounting by Lev and Gu. It discusses the long term decline in the usefulness of accounting metrics due in large part to the change of companies from old school industrial companies that dominated in Graham's day to information based companies with lots of intangible assets, which usually don't show up on balance sheets.
The bros in this sub praising Security Analysis to high heaven usually have no clue about this. Sure, Graham was a genius and by all means read the book, but at the same time realize that times have changed so poring over balance sheets and trying to find stocks trading for less than tangibles is a very niche approach.
Hey I have a question. Do you think that book is worth $56?
If you read Philip Fishers Common Stocks and Uncommon Profits, you'll observe that the best way to discover good stocks is to follow investors you respect. So if there's someone you think is good and he recommends a stock, you should just look into it rather than cast a wide net.
The other approach is the Peter Lynch approach, which is to turn over as many rocks as possible. This however requires the fund manager to be very experienced so that he can spot the patterns of a good stock (in various industries) the moment he sees it.
I would have to agree with you. I did not use a screen to find DX, I looked at the past 10 years of financials on all stocks on the NYSE and NASDAQ individually to come to my conclusion. Sure, I think screens are very misleading. I like to look at a trailing 10 years of financials to build a case for a value investment. Screens tend to focus on a much shorter time frame and most of the data is based on the past year, trailing year or an aggregate of analyst’s pro forma numbers. I don’t consider that a deep dive, more of a tip of the iceberg. I find that screens throw the baby out with the bath water so to speak. Screens leave you with a short list that has been very poorly vetted. If you need a lot of information at your fingertips, the best free one I have found is at www.finviz.com . Either way, I believe there is no excuse for doing the homework necessary to come to an investment decision.
Which Soros book are you referring to? I hope it’s not The Alchemy of Finance, that one is just the worst... ha! It reads like a fever dream. I once found a comic book about Soros. That one was much better. - I'm just messing around, but the comic book is real... can't make this stuff up... ha!
I've read many a book on investing and any title I can find on value investing and this one sticks out in my mind. If you can get around the fact that Guy reminds you of his ivy league pedigree every other page (once is enough) it really is a honest, deep dive into his career and how he moved towards best practices in value investing. If you are going to read this book then you need to read Dhandho Investor by Mohnish Pabrai right after. Think of The Education of a Value Investor like "The Godfather I", and Dhandho Investor like "The Godfather II". These guys are buddies and peers in value investing and should be thought of as a package deal. Let's call The Alchemy of Finance by George Soros "The Godfather III" as it makes a better door stop or paperweight than a source of valuable finance information. The best part of The Education of a Value Investor may be the bibliography / reading lists in the back. There are some excellent titles listed for further reading there.
All kidding aside, it's a great title and you should definitely take the time to read it. I rented mine from my library so maybe you can do the same at yours.
I'll throw out one more favorite:
One Up on Wall Street by Peter Lynch. A foundation for how individual investors can beat the pros, because we are not constrained to the same rules as them.
And a few more that aren't really investing books, but are relevant if you want to get better at making investment decisions:
Thinking, Fast and Slow by Daniel Kahneman. The father of Behavioral Economics writes on how to understand and control your biases in investing and life.
The Signal and the Noise by Nate Silver. How to interpret data and statistics, applicable to financial analysis.
And a few that aren't really investing books at all, but are books giving an inside or historical look at businesses:
The Fish that Ate the Whale by Rich Cohen. A biography of "Banana King" Sam Zemurray, who propped up Banana Republics and became CEO of United Fruit. A fun and exiciting read.
The Snowball by Alice Schroeder. A biography of Warren Buffett. Very long and detailed... you have to really like Buffett to get through it.
Liar's Poker by Michael Lewis. A wild look inside Lehman Brothers during their 1980's heydey.