Summary of Adam Seessel's Where the Money Is

Everest Media

Description

Please note: This is a companion version & not the original book.
Sample Book Insights:
#1 Good investors have a monk-like devotion to their field. They do not live by testosterone or adrenaline, but by study, learn, and practice. They do not make decisions based on urgency, but on a patient incremental approach.
#2 The reversion to the mean framework is a mathematical term for the simple idea that life eventually returns to normal. It states that nothing essential changes in the world’s economy, and that if stocks are cheap relative to their profits, they will eventually return to a normal, lower valuation.
#3 I was a junior oil and gas analyst at Bernstein, and I fed data about the companies I covered into the black box computer model. In the late twentieth century, everything returned to normal, which generated large gains for the firm and its clients.
#4 I had begun to feel that the market had finished weighing my stocks and found them wanting. The companies I owned shared two characteristics: they were all cheap stocks, and historically that had been a good quality. But all of them likely had their best days behind them.

Sujets

• Investing
• Personal Finance
• Economics
• Business

Informations

• Publié par: Everest Media LLC
• Date de parution: 24 juillet 2022
• Nombre de lectures: 0
• EAN13: 9798822547308
• Langue: English
• Poids de l'ouvrage: 1 Mo

Extrait

Insights on Adam Seessel's Where the Money Is
Contents Insights from Chapter 1 Insights from Chapter 2 Insights from Chapter 3
Insights from Chapter 1

#1

Good investors have a monk-like devotion to their field. They do not live by testosterone or adrenaline, but by study, learn, and practice. They do not make decisions based on urgency, but on a patient incremental approach.

#2

The reversion to the mean framework is a mathematical term for the simple idea that life eventually returns to normal. It states that nothing essential changes in the world’s economy, and that if stocks are cheap relative to their profits, they will eventually return to a normal, lower valuation.

#3

I was a junior oil and gas analyst at Bernstein, and I fed data about the companies I covered into the black box computer model. In the late twentieth century, everything returned to normal, which generated large gains for the firm and its clients.

#4

I had begun to feel that the market had finished weighing my stocks and found them wanting. The companies I owned shared two characteristics: they were all cheap stocks, and historically that had been a good quality. But all of them likely had their best days behind them.

#5

Until recently, investing in tech meant investing in hardware companies, which proved the wisdom of Buffett’s advice never to confuse a growth industry with a profitable one. In 2016, Buffett bought $7 billion worth of shares in Apple, a hardware technology company.

#6

I went to hear Warren Buffett and Charlie Munger speak at an annual meeting in Omaha in May 2017. By that time, I had sold Avon, Tribune, and the other stocks whose best days were behind them. I had concluded that these companies were value traps: cheap, but not valuable.

#7

At the following dinners and cocktail parties, I found that no one wanted to talk about Apple or the new digital economy. Instead, they continued to discuss the same old old-economy businesses.

#8

I began to invest in such companies, and I noticed that Lew Sanders was doing the same. The world has changed, he said.

#9

Graham was a financial analyst who, in addition to being brilliant, was also absentminded. He invented a new version of the slide rule, but he would also often show up at work wearing two different-colored shoes.

#10

By 1920, Graham was a new father and needed to find a reliable way to make money. He began to notice patterns in the financial statements of companies, and began to focus his mind on concrete financial data rather than odds on who would win the next presidential election.

#11

In 1923, Graham quit his job at Newburger, Henderson Loeb to start his own investment operation. He was only 29, but he had an edge. He knew how to distinguish between what was important and unimportant, dependable and undependable.

#12

In 1927, Graham went to the Northern Pipe Line’s annual meeting in Pittsburgh, and presented his ideas to the company’s other shareholders. The brothers, who ran the company, were not interested in changing their policies.

#13

Graham’s asset-based approach was working well, and he used the securities he owned as collateral to borrow money and buy even more stocks with it. He leveraged up, as Wall Street slang goes, or went on margin.

#14

Graham’s system was rigorous, disciplined, and verifiable. He outperformed the larger market by a comfortable margin from the 1930s until he retired in 1956.

#15

There are several problems with Graham’s system. Value 1. 0 is a short-term strategy that requires a constant portfolio recycling as inexpensive stocks appreciate to fair value. It was well-suited to its times because it kept investors away from speculating.

#16

As time went on, however, and the world emerged from the Great Depression, Graham’s system seemed increasingly ill-suited to the American economy.