The value investors: Lessons from the world’s top fund manager (Part 1)
Author: Ronald W. Chan
Walter Schloss (Walter & Edwin Schloss Associates)
“I learned that if I can simply survive in the market, just like surviving in the war, and not lose money, eventually I will make something”
“The best way to invest is to lay out rules which, if followed, would reduce the chance of loss”
“Nothing terrible happening to you is a profit”
“Understand ones strengths and weakness… When you have made a sound decision, make sure you have the courage to stick to it”
Strategy:
- Finding net-nets
(CA – Liabilities) / total share outstanding
- Stocks selling below their book value
- Buy assets instead of earning since assets don’t change quickly unlike earnings
- Diversify (50 – 100 stocks)
- Doesn’t worry about macro factors, or the underlying business, but whether the stock is undervalued
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