Picking Stocks

 

Where is the best place to learn?

• Education from financial institutions tends to focus on the products they sell and how customers can use them as much as possible. Wells Fargo was recently fined $1 billion for taking this too far. 

• ETRADE: makes money when you buy a stock and makes money when you sell a stock. Is E-trade going to teach you that a very effective way to invest is to buy stocks and hold them for the long term?

• CNBC: is in business of selling advertising. The more sensational the story the more eyeballs will watch it. One example: they cover Bitcoin often and promote it as an investment, but is it really an investment?

 

This is not to suggest companies are doing anything unethical or wrong. Rather, all investors need to understand the conflicts that exist so they are able to make the best decisions for themselves.

 

We will learn from members of the investing all star team, who include Warren Buffett, Benjamin Graham and Peter Lynch. These individuals are not selling a product and the advice they give is to help investors.

 

Key concepts: 

• Time Horizon: buy with intent to hold for the long term.

  • insert Buffett punch card quote

• Stock Ownership: view as same as owning a business.

• Buy Only When Margin Of Safety Exists

• You can add other filters:

  • buy quality companies. Munger taught Buffett this.