Many ways to skin a cat but those who understand Warren Language tend to skin the cat better
I got about 10 criteria after I understand the business...
if you work out 10 criteria including some of those mentioned
and apply these criteria to all the stocks you want to buy...
you be suprise not many companies made the grade ... buying is so easy when the price is right cos you dont have many to chose from
the one that dont made the grade, they may gain 100% here and there due to speculation but long term they probably go to corporate grave yard
you get rid of all the rubbish by a very simple elimination process.
It's not an idiot proof techniques but it's pretty good, you probably end up with a dud stock here and there due to laziness but the other will reward you far far more return than the dud stocks..
you easily outperform the market and the so called expert fund mangers by a mile.... you get lot of of capital growth and dividend growth you retire very rich on dividend income
I aint reaching retirement age, still in my prime and stock dividend fund my life style
now and well into my retirement.
you should listen carefully to Warren Buffett speech and his annual report letter to shareholders try to deciper what he's trying to tell you..he provides the best advices money can buy and it's FREE.... once you understand Warren Language you straight away know a good company from a dud.
you should be patient and have a long term view and not tempted to trade because it's gone up 30% or cut your lost because it gone down 50% since you bought them.....
maybe thinking of top it up rather cut your loss
rememeber company that made the 10 criteria grade RARELY or never go bankrupt so why not buy more when they are cheap.
I havent trade a stock for 12 months but I bought 8 times, some top up of existing one cos I get more for less, maybe I lie I may have sold one or two but I rarely sell on a regular basis and it's not my thing to buy and sell all the time..
some stocks now sitting at 100% gain not one but a few, since last year but still not tempted to trade.
cos it's still a good company and that 100% gain could be 400% gain in the future or more.. and as long as the dividend and earning grow with the stock, no reason to sell..
Only sell when you beleive it truely over value and you can find better value in another stock else sit back and eat frank dividend nothing better than that.....
and be true to yourself, dont be affaird to buy big when other jumpship if you believed you done your home work and you know it better than Reg Kermode for Cabcharge and Graham Turner for Flight Centre. (disclosure I own both stocks)
this will yield you crazy return when good company dump at bankruptcy price
That is how I view fundamental investing, there are more to it than just PE.
PE may get you some cheap stocks but Patient,
independent thinker and buy wonderful company at the right price is the formular you need to build wealth.
and Warren is Absolutely right when he said
"You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with 130 IQ."