Putting it all together

I'm sure it is a question that is on the mind of many beginners.

I have studied a finance degree at university and CFA level 1, so I have quite a solid understanding of basic finance terms, ratio analysis, valuation and financial statment analysis.

However, the problem I face now is putting it all together. Because there is so much information out there, I'm not sure where and how to begin to put it all together/build a meaningful model.

Are there any resources/books which can teach me how to put it all together when trying to perform analysis on specific companies? Furthermore, is there any resources which I can leech off (where ratios etc are already calculated) so I do not have to start from scratch (ie annual report) with every company that I try to look at?

Many thanks in advance.

timruan1 said:

... so much information out there ...

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hi timruan,

Welcome to ASF

Here's what I do:

I start with a narrative, eg Commodity Boom in China
They need steel ...
major components of stainless steel and moly steel ...
iron, nickel, manganese, molybdenum.

Then I trawl the ASX Annoncements (I used to do this every trading day) searching the titles for keywords.

This will lead to a watchlist from which I get share price action and subsequent annoucements.

Some members like the Energy story ... oil ... shale oil!
Coal seam gas!


Anyhoo find one you like and good luck!

timruan1 said:

Furthermore, is there any resources which I can leech off (where ratios etc are already calculated) so I do not have to start from scratch (ie annual report) with every company that I try to look at?

Many thanks in advance.

Click to expand...

This may help, although I can't vouch for their accuracy and I haven't used their info. as I rarely trade ASX stocks.

http://www.traderdealer.com.au/Fundamentals/ASX-Companies/

From their home page:

" . . . Trade Dealer provides you with free ASX fundamental data. . . simply click on the ASX stock code or company name you are interested in, to review ASX share price information, company size, research analyst forecasts, share and financial ratios, as well as a business and financial summary."

Burglar and Artist: Many thanks for your reply!

I will use your ideas to do a trial run once I get home from work tonight and perhaps you or someone else on the forum can give me some feedback on where I went wrong, and answer my follow up questions. =)

Many thanks in advance.

timruan1 said:

Burglar and Artist: Many thanks for your reply! ...

Click to expand...

Not for the faint hearted!

https://www.aussiestockforums.com/forums/showthread.php?t=25035&page=2

timruan1 said:

I'm sure it is a question that is on the mind of many beginners.

I have studied a finance degree at university and CFA level 1, so I have quite a solid understanding of basic finance terms, ratio analysis, valuation and financial statment analysis.

However, the problem I face now is putting it all together. Because there is so much information out there, I'm not sure where and how to begin to put it all together/build a meaningful model.

Are there any resources/books which can teach me how to put it all together when trying to perform analysis on specific companies? Furthermore, is there any resources which I can leech off (where ratios etc are already calculated) so I do not have to start from scratch (ie annual report) with every company that I try to look at?

Many thanks in advance.

Click to expand...

Can you elaborate on the type of model and components you are trying to assemble it with?
You have the hang of reading financial accounts, valuations etc. but what else are you looking to add to that? Are you looking for indicators or parameters that automatically eliminate unsuitable stocks before you waste time on them?
Or are you looking to create a system where the basics are easily determinable so you can progress quickly to more in depth research.

If you have the time available, I don't think it is a bad thing to look at the crappy stocks, they keep your perspective when trying to find the treasure?

From what angle will you be coming at stocks? Financial, peer comparison, attributable resource, spec potential etc etc or a combination of any/all of the above?

Hope you get where I am coming from, giving opinions is second nature to me , but I just found your first post lacking a little detail, so didn't know where to start.

Cheers,
SH

Interpreting Financial Statements- Warren Buffett

The above is quite a good one, tells you what to look for in the income, balance sheet and cashflow statement to discover if it is a great company or not.

Security Analysis- Benjamin Graham

This is another good one. It's quite hard to understand and read, but it is well worth it even if you pick up 1-2 tips from it. You definitely need to have a grip on accounting and numbers if you want to read this one

Common Stocks, Uncommon Profits- Philip Fisher

This one focuses less on financial statements and more on identifying companies with great growth potential long term. It also shows the "scuttle butt" method of looking for good companies.

Have a go at reading those. Other ones to look at is anything in your local library. Just research all you can about different methods of looking at stocks. I'm more of a longer term, big brands type investor, but that doesn't stop me reading about growth stocks, day trading, etc so I can pick up tips and tricks every now and then. Another good resource I find is online newspaper websites and their business sections. Sydney morning herald for example.

Then there is Technical analysis.
Once proficient analysis can take 5 mins
You can computerise conditions which
Can filter 1000s of stocks.

You can be definitive ratifier than subjective.

You can systemize long and short methods
For shorter term trading in less than ideal
Markets.