Here’s a scenario: you’ve identified a potential investment, you’ve gone through the checklist and done your research, and you decide that you’ve found a deal that other people seem to be overlooking.  You pull the trigger to buy into this company, and then the stock price begins to decline and you begin to wonder if you’ve made a mistake. Knowing the difference between having confidence in your investing process and being arrogant or blindly confident in a position can allow investors to act on proven strategy as opposed to being driven by fear and emotion.  Having a long-term outl ..read more

As detailed in the most recent edition of Berkshire Hathaway’s annual shareholder letter, finding success in value investing doesn’t require fancy credentials, obsessive research, or exploitative scheming — it takes common sense and the willingness to keep yourself informed about your investments. In a world full of people rabidly vying for your attention in every imaginable arena, knowing how to focus that attention on what’s important while weeding out the noise of the pundits and snake oil salesmen is what separates successful investors from the rest of the pack. In this week’s show, Phil ..read more

“Character reveals itself in adversity” is a saying that can not only apply to the human race and how our true nature shines through when faced with a challenge, but also one that can apply in the business world. Although brand loyalty can be a common trope in 21st century consumer culture, how does that sentiment hold up when the rubber meets the road? In these times of inflation, shrinkflation, and other types of -ations that we’ve yet to ascribe catchy names to, some brands are seeing once-loyal customers jump ship and look for better value as prices rise. While some brand relationships ca ..read more

In a vault episode from the early days of the podcast, explore the world of value investing in this as Phil and Danielle delve into the power of dividends. Discover how making well-researched, long-term investments can potentially amplify returns and provide a steady income stream. They discuss the strategy of reducing risk by 'getting your money off the table' through dividend-producing companies. But remember, while dividends offer stability and returns, they're not without their tradeoffs. We'll uncover the complexities of managing dividend-paying companies and navigating potential risks ..read more

"Invert, always invert" — Charlie Munger To become a top-notch Rule #1 investor, having a well-defined investing strategy is essential. It starts with crafting a compelling narrative for the company you're eyeing and understanding why it's a stellar investment. But here's the twist: flip that narrative on its head and scrutinize the opposing viewpoint. Challenge yourself to construct a case against the investment. If you can't, it's a sign that you might lack comprehensive knowledge about the company. When applying inversions to business acquisitions, consider formulating a robust inversion ..read more

In the practice of value investing, just like with so many other things in life, knowing when to wait patiently or when to jump ship is critical to the long-term success of your portfolio. Being able to stomach market fluctuations isn’t something that everyone is capable of, but the mindset of buying into a business with long-term goals of generating cash flow means buying with the confidence that you’ll be able to weather the storms that may, and often do, come your way. As the series on the Weather Matrix continues, Phil and Danielle discuss the importance of being in the “high understandi ..read more

Is there a limit to how much an investor should know about a potential investment? While it can seem like there’s an infinite amount of relevant considerations for any given business, the ability to discern the difference between important information and extraneous data is an indispensable tool in the investor’s kit. If jumping into the deep end of the S&P 500 seems like a daunting proposition, keeping your investing practice focused on a smaller scale can make the process of understanding “the weather” a much more manageable task. Keeping the boundaries of your research close ..read more

Last week, the episode was centered around a tool for evaluating potential investments based on the myriad factors impacting their current performance and future trajectories, a topic that our hosts dubbed “the weather” of a business. While having a handle on a company’s worth and a clear gauge on one’s own understanding are both vital in making investment decisions, what other factors can—or should—influence the process? The fundamental feeling of excitement or intrigue can be a divining rod in terms of pursuing investment opportunities, and though it can be easy to get caught up in the ..read more

The 21st century has brought the world a number of revolutionary developments that have turned the world on its head, with one of the most important cultural shifts being the rise of the attention economy. With so many entities all vying for a piece of your time, how can you know when you’re spending too much of that limited resource on your investing research? With decades of investing experience and a bit of basic mathematics, Phil explains a tool to classify companies into four groups based on their price/value ratio and the investor’s understanding of the business. If you find y ..read more

Following up on last week’s discussion about the “weather” of a business, or how the climate of various internal and external factors can influence the long-term success of your prospective investment. With so much data available at our fingertip, how can we know what information is useful for research and what can safely be left out of our analyses? Whether you’re looking into a company’s direct competitors or doing a bird’s eye view of a whole market sector, knowing when to go deeper vs when to stop digging is an incredibly useful skill to have in the world of 21st century global finan ..read more