Hello and welcome to our community!

[jarredjackman]

Hello, my name is Jarred and I'm beginning to learn more about investing. I began receiving free emails of Steve Sjuggerrud's Daily Wealth. Upon looking into it for validity, I stumbled upon this site.

I'm a teacher and have begun the groundwork for starting a business that will offer products such as shirts, furniture, bags, standard consumer goods. The difference will be the design; these objects will be focused on critical design, necessity, intelligence. I will expand product line as success permits.

My reason so joining this forum is that I truly wish to learn more about investment possibilities for individuals without $10,000 to throw around. Many investments seem to recommend a person have a strong portfolio. I'm a teacher with student loans and a mortgage, portfolio, what's that? HA.

I want to get started building more financial freedom that the simple IRA and 401K allow. I'm leery of deals that sound too good to be true, hence my suspicion of Daily Wealth as it usually sounds like it's risk free with big pay-offs. I'm here, I'm listening, I'm interested. If you have any advice, I'm all ears. If there's anything I can help a person with, I'll be more than happy.

take care
Jarred

[zh82]

Hello everyone, I'm Zach.

I heard Phil a couple of years ago at a Get Motivated seminar and grew more and more interested in investing since then.

I've been going through his book and I'm almost done with it. I'm going very slow and doing my homework so I know I understand the concepts.

Now that I'm out of debt (except the good ol' mortgage) and have a little money to play with, I'm looking to gather as much info on this system and other successful investing methods as I can.

Any hints or tips would be great. I'd also like to hear about any success stories using rule #1 if there are any out there!

Z

[Patrick]

First off - Thank you Justin for creating this wonderful forum.

I will be downloading your tools and continuing to learn so here goes for now:

Hi Everyone!

Patrick here; 54 years old in NY. I picked up Phil's book about two weeks ago and am very enthused about the potential of "Value Investing" according to the Rule #1 System.

If you're one of my friends I referred here by the way - Say Hi!

Here are some of the things I've found:

http://bigmoatstocks.com/

At bigmoatstocks we can purchase a list of Big Moat Stocks here which can be useful as a primary list to scan for potential Meaning candidates to you personally - then of course check Management and MOS. You can get the 2006 List for free - probably any stocks which are still on the list are worth a second glance right off. Has anyone bought this list? Opinions?

And here are two sites which give a quick overview of the whole enchilada.

On the links below, I've purposely included a search for NTGR - you can pop in any other.

These should be Very Helpful - however - I've noticed that their results don't match!

My question for any of you seasoned number crunchers: Is either one accurate or more accurate?

Your views are very much appreciated - I would love to narrow it down to one dependable First Screener.

(My general idea is to start with the BigMoat Stock list, see which I grock (Meaning) and then Screen by one of the tools such as the ones below.

Then Research Management.

If it makes it through these initial hoops - put 'em on the watch list and keep an eye on the three tools while I then individually confirm the calculations personally and continue to learn about the company and simultaneously increase my understanding of Rule #1 & Value Investing etc.

[I'd also like to form a small weekly in person study group at meetup(http://www.meetup.com/) and coordinate our studies with the ROIC community here!]

Anyway - I'll leave it at that for now and please examine the two links below and let me know which is most accurate according to your calculations as well as share any other useful sites or information.

I think it would be great to have a brief outline of the system as a sort of study guide along with the best links that we can share with any fellow study group buddies we team up with.

~ Patrick

Here are the links for zadbaz and stocks2own using NTGR as an example:

http://zadbaz.com/servlet/GetStockSummary?ticker=NTGR


http://www.stock2own.com/StockAnalyzer.aspx

[Kenthar]

Hello everyone I'm Mark from New Jersey. You might be surprised to hear that I am a thirteen year old middle school student. I first got into investing a few months ago when my aunt described how the stock market worked and how it outperforms all other asset classes over any 20 year period. I thought to myself "Well, if I can put my money now and leave it to compound, I should be able to jump-start my college savings and let them compound higher than the 2.00% my bank has me earning. Then maybe I won't have to take down as much money in student loans." So, upon hearing my aunt I immediately went to the library and took down a few stacks of books, which I devoured immediately. Among them was Buffettology, written by Warren Buffet's ex daughter-in-law. I found his strategy of low-risk conservative long term investing to be just what I was looking for. Always being one for sound reasoning and logic, I knew that if I was to let the magic of compounding work for me, I would need to let my money sit in an excellent company for a long period of time. Warren Buffet's strategy entails just that.

A few days after finishing Buffettology and a few others, I grew even hungrier for information. I soon learned while over my aunt's house that my uncle had quite a few books, one of which was none other than Rule #1 Investing by Phil Town. Within a day I had scoured it twice over, and found his approach surprising similar to that of Buffet. Look for a company with a wide competitive "moat," good management, efficient capital allocation, and strong consistent growth of revenues, earnings, and cash flows. Then, the key is to buy it while "Mr. Market" is pessimistic about the future, and thus severely undervalues the equity. Buying with a nice and fat margin of safety will ensure safety of your investment even if you botched the calculation of intrinsic value.

So, after looking into a few pieces of Graham's work, reading "The Warren Buffet Way," and skimming over some articles on value investing, I was ready to get in the game. After sifting through a TON of companies, I found a few likely opportunities. I liked Garmin, Hansen Natural, Best Buy, and a few other companies that were good in every sense, but didn't have a good enough margin of safety. So, I made my first investment through my dad's account, and bought 8 shares of Garmin at 52.83 with money from my bank account. I happened to have bought on a spike, and soon realized that I had misread the tools of Rule #1. It swiftly descended back to where it was at $46 and change. Unshaken, I held on, knowing that it was just short term volatility and I would be fine. I waited a few monthes with not much happening to the share price, as I anticipated July 30th Earnings. This is when I felt the fury of Wall Street firsthand. Garmin reported an EPS 7 cents below the consensus analyst estimate, if you omit their one time gain on the tendering TeleAtlas shares. Garmin also delayed the Nuviphone from December release back to "mid 2009." The stock went into an absolute freefall. I couldn't believe it. They delay one product, slightly miss earnings, and everyone ignores the long term prospects? You don't know what it feels like to experience such an unjust short term decline until you feel it yourself, with real money. Garmin feel 21% in a single trading session. It hit bottom somewhere in the $34-$36 range. Meanwhile everyone ignored this news release:

PND vendor Garmin Garmin has widened its gap against rival TomTom TomTom - Wikipedia, the free encyclopedia to 37 percentage points in the North American market in the second quarter of this year, compared to 23% points in the previous quarter and nine percentage points in the fourth quarter of 2007, according to the latest data available from market research Market research - Wikipedia, the free encyclopedia firm the NPD Group. Garmin, powered by the robust sales of its 2xx-series PND devices, captured a 55% share of the PND market in North America in the second quarter, far ahead of the number two ranked vendor TomTom’s 18%, NPD said.

I think my next course of action will be to re-read Buffettology and Rule #1 to better understand some concepts, especially "The Tools." Then I will paper trade for a few monthes, or years, depending on how long it takes me to get a decent return.

Anyway, I'm rambling like I always do. I look forward to becoming a part of this community and I hope we can all gather some wisdom, and of course, some money.

[Gunnski]

Kenthar,

Wow! Nice job. Young people like you make me very proud to be an American! I know your going to do very well, if you stick with it & make smart choices in your investments! Read everything you can get your hands on re: investing.

Best of investing to you and your family.

[Straddle]

@ Kenthar: Nice post. I'm 23 and I thought of myself being a young investor

About Garmin: It's also one of my favorite stocks on the moment. Did U check the 3 tools (technical analysis) that are mentioned in Phil Towns book? Those tools stopped me from pulling the trigger on that stock.

I suggest you first start playing with virtual money on websites before you put real money in it.

Buffettology is indeed a nice book on the Buffett way, but I liked How to pick stocks like Warren Buffett better.

[Kenthar]

To Straddle:

Hmm, I don't think I've heard of that one. I'll have to check it out soon. And yeah, I think I might have misread the Tools chapter a bit, I'll have to go back and reread that a few times. I believe a poster in the "Searching for an Investment" Section made a pretty good point on Phil Town's strategy though. Read the thread titled "How Phil Town can lose you money." It explains how some of the stocks that turn up are high-growth stocks that have tanked and look cheap because of their small multiple. Although they will usually look like a good buy, the multiple is a trailing number and doesn't represent the growth of earnings that is to be expected in the future. Seems interesting, and kind of scary.

I think I'm going to take a step back, read the book again, and then take your suggestion and start playing with some virtual money. I started up a virtual stock market game on Investopedia.com, maybe somebody can join me and we can guage each other's performance. Although, I have one question about the whole playing with fake money deal. I only have a few hundred dollars that I have saved up from various events (birthday, christmas, etc.) and when you create a game it asks which demonimation of money to start with. I can't really buy any more than 2 stocks with a sizeable enough position when I have only $500-$1,000, but I don't want to use too large of an amount when I'm paper trading because then I'll get used to taking down large positions of stock that I couldn't afford in reality. So I guess the bottom question is: Should I paper trade with the amount I have (the game minimum is $1,000), or a larger amount, say $10,000? Thanks.

[Jenkmister]

Welcome to our new and younger members of the community! Just wish someone had introduced me to investing at a young age. My investing career didn't start until after age 30 and was out of college. So congrats to those that are taking control of their financial future so early in life.

Would highly recommend that everyone buy a copy of "Richest Man in Babylon" by George Clason. First published in 1926, this still has great value and wisdom. Can be found new for less than $10, and for less at a used book store. Investing in stocks is one method of earning money, but this gives a more general view of how to manage your income - expenses - life. It's my firm belief that if one will live by the rules outlined in this book, that you will avoid most of the financial problems 90% of Americans seem to self-inflict.
The Richest Man in Babylon (book - Wikipedia, the free encyclopedia)

Secondly would recommend William O'Neil's "How To Make Money in Stocks". This is some advice on following the trend of the General Market, and that one should not always be buying if the market is heading down! Seems to be good advice considering our current market.
Amazon.com: How to Make Money in Stocks: A Winning System in Good Times or Bad: William J. O'Neil: Books

To your wealth and happiness;
Jenkmister

[ValuePilgrim]

Hi everyone. Came across this forum while searching for resources about Seth Klarman.

I'm 36 and live overseas in East Asia. About a quarter of a way through an MBA program. Really got interested in investing while taking a corporate finance class and stumbled on "The Intelligent Investor".

Have a China growth fund that's sadly not doing too well, but am going to refocus on value investing in the next couple months.

[BillyBadger]

Hello Justin and hello to all,
My name is Billy and I am retired military currently working with a great company as a defense contractor supporting the War on Terror. I am 45 years old, my beautiful wife Jennifer is 31 and we decided to have children after I retired from the military. Sooooo, we have twins on the way!
I have been reading Phil Town's book and am determined to learn how to make my money work for us. I feel so fortunate to have stumbled across this site. Justin, you are truly amazing in that you took on this endeavor and selflessly chose to jump in and start something that will benefit many...my hat's off to you. I promise to donate when I can and at the least I will click on a supported Google site whenever I am logged on. I am anxious for both me and my wife to learn and hopefully become knowledgeable owners of companies with great returns (because I won't own a company for 10 minutes if I'm not ready to own it for 10 years). I wish the same for you all and am looking forward to starting.

Billy