The 85 Investing Lessons Robin R. Speziale *** Published by Robin R. Speziale at Smashwords Copyright 2012 Robin R. Speziale *** Author of Lessons From The Successful Investor: Lessons From The Successful Investor is the new investing classic of our time. With thousands of downloads, this new investing eBook has topped bestseller lists across major digital book stores and has received rave reviews. Now available for only $4.99. The new investing classic contains 85 timeless lessons to help you build a quality portfolio of value stocks that will make you wealthy. Reader Reviews - Lessons From The Successful Investor: “This book is an absolute must for all new and inexperienced investors” “This book has given me the confidence to be able to manage my own portfolio” “I downloaded your book and could not stop reading it until the end” “I have been reading many books on investing in the last while and by far this has provided the most insight” “I have the Ben Graham book but you have made it make sense” “Incredibly informative and really motivated me to drive the inner investor I always knew was inside me” "Finally a book with easy to follow stock principles" Other Titles by Robin R. Speziale: The Investing Starter Guide A Brief Stock Market History The Investor’s Checklist The TFSA Guide *** Contents INTRODUCTION Chapter 1 - MARKET HISTORY Chapter 2 - BUSINESS VALUATION Chapter 3 - COMPETITIVE ADVANTAGE Chapter 4 - STOCK VALUATION Chapter 5 - THE IDEAL INVESTMENT Chapter 6 - MANAGEMENT Chapter 7 - PORTFOLIO Chapter 8 - THE STARTER PORTFOLIO Chapter 9 - THE INVESTOR GIANTS Chapter 10 - INVESTOR PSYCHOLOGY Chapter 11 - THE ANTIQUITY THEORY Chapter 12 - SUCCESSFUL MENTALITY Chapter 13 - COMPOUNDING WEALTH Chapter 14 - THE YOUNG INVESTOR Chapter 15 - THE INVESTMENT INDUSTRY Chapter 16 - REAL ESTATE Chapter 17 - RECESSIONARY INVESTING Chapter 18 - FUNDAMENTAL EQUATIONS Chapter 19 - FUTURE OF THE MARKET CONCLUSION *** The 85 Investing Lessons Based on Lessons From The Successful Investor *** Introduction Lessons from The Successful Investor has been a surprise success. I wrote Lessons From The Successful Investor immediately after graduating from the University of Waterloo, having been constantly asked by friends, family, co-workers and acquaintances to consolidate my value investing knowledge into a neat package for easy consumption. That said, the summer of 2010 consisted of researching, writing, and editing Lessons From The Successful Investor, which finally launched September 1, 2010 across major digital book stores. Initially, downloads of the eBook trickled in. However, my value investing speaking appearance at the University of Toronto, coupled with select media coverage, catapulted Lessons From The Successful Investor to the top of major digital book stores. And at that point, downloads started pouring in followed by wonderful feedback from readers, aspiring value investors, around the world. A reader review that struck me was from a gentleman based in Portland, Oregon, who proudly exclaimed, “I have the Ben Graham book but you have made it make sense”. You see, Ben Graham is the father of value investing, author of The Intelligent Investor, and my investing idol. That was a turning point for me. I started touring Canadian Universities, spreading the value investing lessons from Lessons From The Successful Investor. I compiled brand new investing eBooks in 2012. And I started consulting individuals on value investing principles. At the end of the day, what makes me happy is when readers like you benefit from my value investing lessons. Indeed, Lessons From The Successful Investor is the investing classic of our time, containing 85 timeless lessons to help you build a quality portfolio of value stocks that will make you wealthy. Once you finish reading this eBook, I hope you download the original Lessons From The Successful Investor and find out for yourself what aspiring value investors around the world are raving about and profiting from. *** Chapter 1 MARKET HISTORY "Those who cannot remember the past are condemned to repeat it." George Santayana Lesson 1: Through boom and bust, the market moves upward. Lesson 2: It’s not different this time. Lesson 3: Significant returns are got by investing at market nadir. Lesson 4: Invest during gloom, never sell, and ride the wave. Lesson 5: A sleeping stock will eventually be awoken by the growth beneath. Lesson 6: A dead market will revive; do not miss its return. Lesson 7: A lost market does not predicate that all stocks are lost. Lesson 8: A fallen stock does not always spell opportunity. Lesson 9: The market rewards the patient and punishes the hasty. Lesson 10: Ups and downs in the market retreat upward over the long term. Lesson 11: At birth, businesses come and go. At maturity, only the adaptable remain. Lesson 12: New stocks take time to find loyal owners. Lesson 13: In the long term, a stock’s price increases in line with its underlying growth. *** Chapter 2 BUSINESS VA LUATION “A small leak can sink a great ship.” Benjamin Franklin Lesson 14: A growing book value is a growing business. Lesson 15: A dividend, while not always warranted, underscores the consistent business. Lesson 16: Earnings must fuel more earnings and those earnings must fuel more. Lesson 17: Revenue should grow in any pasture, green and not so green. Lesson 18: Your money invested must see ample return; else why invest your money? Lesson 19: A high profit margin underlies the impenetrable business. Lesson 20: Significant debt is a heavy anchor for any business. Lesson 21: Cash is king. *** Chapter 3 COMPETITIVE ADVANTAGE “We provide food that customers love, day after day after day. People just want more of it.” Ray Croc Lesson 22: Only invest in those businesses with clear competitive advantage. Lesson 23: A competitive advantage in one setting may not be a competitive advantage in another. Lesson 24: The DOW and S&P TSX/60 offer examples of some but not all competitively advantage businesses. Lesson 25: Capital intensive businesses are intensively bad businesses. *** Chapter 4 STOCK VALUATION “October. This is one of the peculiarly dangerous months to speculate in stocks in. The others are July, January, September, April, November, May, March, June, December, August, and February.” Mark Twain Lesson 26: Low dividend yields are correlated with small returns. Lesson 27: A stock with a low P/E is mistakenly love at first sight; beware of fatal attraction. Lesson 28: A low P/S means revenues are being undervalued. Lesson 29: As book value approaches market value, the stars align and opportunity shines. Lesson 30: Value investing means finding a business the market is undervaluing. Lesson 31: Growth and value should always be happily married. Lesson 32: Sell a badly performing business, not a badly performing stock. Lesson 33: Getting a good deal is not risky business, getting a bad deal is. *** Chapter 5 THE IDEAL INVESTMENT “Simplicity is the ultimate sophistication.” Leonardo da Vinci Lesson 34: Get the winning scorecard or lose the investing game. Lesson 35: Find the ideal business of today and tomorrow, today. Lesson 36: Technology is a rapid destroyer of many once ideal investments. Lesson 37: Some great stocks are terrible businesses; some great businesses are terrible stocks. Lesson 38: The ideal investment need not qualify a premium price. *** Chapter 6 MANAGEMENT “The best way to predict the future is to create it.” Peter Drucker Lesson 39: Invest with good managers that need no critique. Lesson 40: A manager with stake in the business manages as an owner, not an employee. Lesson 41: When a manager buys back shares of a business, shareholders own more of that business. *** Chapter 7 PORTFOLIO “Concentrate your energies, your thoughts and your capital. The wise man puts all his eggs in one basket and watches the basket.” Andrew Carnegie Lesson 42: A chicken farmer does not buy cows for the sake of diversifying his farm. Lesson 43: The greatest returns tomorrow are from the greatest opportunities today, regardless of asset class. Lesson 44: In a successful portfolio, you will have winners and averagers. Lesson 45: Good old portfolio management is so easy that it should not work, but it does. Lesson 46: The lost ride on the coattails of others portfolios. The successful learn from others portfolios. *** Chapter 8 THE STARTER PORTFOLIO “Take time to deliberate; but when the time for action arrives, stop thinking and go in.” Andrew Jackson Lesson 47: A starter portfolio will one day be a wealthy portfolio. *** Chapter 9 THE INVESTOR GIANTS “If I have seen further it is only by standing on the shoulders of giants.” Isaac Newton Lesson 48: Warren Buffett is example that disciplined, long term investing can reap vast wealth. Lesson 49: Philip Fisher stressed that quality businesses are the best investments and should be held forever. Lesson 50: Peter Lynch has a strict common sense approach to investing. Lesson 51: Ben Graham is the father of value investing. Lesson 52: Stephen Jarislowsky is example that Canadians can amass significant wealth by investing in Canadian businesses. *** Chapter 10 INVESTOR PSYCHOLOGY “The game does not change and neither does human nature.” Jesse Livermore Lesson 53: Deficient psychology skews the so called efficient market, effectively empowering the psychologically efficient. Lesson 54: If you believe what the herd is thinking, you are not thinking. Lesson 55: Do not fall in love with the story stock, because you will not get a happy ending. Lesson 56: Investing without proper behaviour is like eating without polite manners; you get sloppy. *** Chapter 11 THE ANTIQUITY THEORY “Beware of anyone who says they are manufacturing antiques” Unknown Lesson 57: Study the antique business to excel at the investing business. *** Chapter 12 SUCCESSFUL MENTALITY “The three great essentials to achieve anything worth while are: Hard work, Stick-to-itiveness, and Common sense.” Thomas A. Edison Lesson 58: Being successful at investing is a choice before it is a result. Lesson 59: To invest like the successful investor one must think like the successful investor. Lesson 60: Average returns beget mediocre wealth; high returns beget vast wealth. Lesson 61: Shelter your money, everyone wants it. Lesson 62: Global growth is good for business. Lesson 63: Ethical investing just feels right. *** Chapter 13 COMPOUNDING WEALTH “We must use time creatively.” Martin Luther King, Jr. Lesson 64: Compounding money is money working for you. Lesson 65: The patient investor is a wealthy man. Lesson 66: Do not waste dividends on lunch; reinvest dividends. Lesson 67: $1 today is not $1 tomorrow. *** Chapter 14 THE YOUNG INVESTOR “Youth is wasted on the young.” George Bernard Lesson 68: Profit from your mistakes by learning from them. Lesson 69: The young investor must have his own capital invested in the stock market in order to experience the joys of return and the sorrows of loss. Lesson 70: Those who desire instant gratification are never gratified. Lesson 71: Learn from those investors older than you, so you can profit from their knowledge today. *** Chapter 15 THE INVESTMENT INDUSTRY “If you don't know where you are going, you might wind up someplace else.” Yogi Berra Lesson 72: Mutual fund managers put food on their table first, yours last. Lesson 73: Why invest with a mutual fund manager who cannot beat the market? Lesson 74: Do not be lured by the mutual fund industry. Lesson 75: Drown out the stock analyst. *** Chapter 16 REAL ESTATE “It's tangible, it's solid, it's beautiful. It's artistic, from my standpoint, and I just love real estate.” Donald Trump Lesson 76: Seek a return from real estate like you would any other investment. Lesson 77: Real estate that is low in supply or high in demand will render real estate overvalued. Lesson 78: Live in your home, and invest in your portfolio. Lesson 79: If you want to invest in real estate, invest in a REIT. *** Chapter 17 RECESSIONARY INVESTING “Every crowd has a silver lining” P.T. Barnum Lesson 80: Recessions bring frightening prospects to the poor, but exciting opportunities to the wealthy. Lesson 81: A stock on sale is like milk on sale, it is just a better deal. Lesson 82: If you do not know what you are shopping for, you will buy the wrong stocks. *** Chapter 18 FUNDAMENTAL EQUATIONS “Before all else, be armed.” Niccolo Machiavelli Lesson 83: Simple equations can solve for 99% of stock returns. Lesson 84: Successful investing equations are rather simple. Keep it that way. *** Chapter 19 FUTURE OF THE MARKET “The future belongs to those who believe in the beauty of their dreams.” Eleanor Roosevelt Lesson 85: When the common investor looks west, head east. *** About the Author: Robin R. Speziale is proud author of Lessons From The Successful Investor. His mission is to spread the 85 lessons from the successful investor to aspiring and skilled investors alike. Robin R. Speziale is a University of Waterloo graduate. Aside from writing, he heads Buddingup.com [...]... CoopJobs.ca He attributes his interest in investing to Warren Buffett His investing principles are based on value investing Robin R Speziale resides in beautiful Canada Robin R Speziale also delivers quality value investing speeches to his wide and devoted reader base Connect with Robin R Speziale - r .speziale@ gmail.com What the Media is saying About Robin R Speziale: "A fan of Warren Buffett, he's... consumer companies with a strong brand and a "moat," a competitive advantage that others cannot easily penetrate." Ellen Roseman, Moneyville "Mr Speziale has plenty of advice to pass on in his new book." The Globe and Mail "Robin Speziale has a passion for investing in his own financial future, and that of others." The Mississauga News ### . The 85 Investing Lessons Robin R. Speziale *** Published by Robin R. Speziale at Smashwords Copyright 2012 Robin R. Speziale *** Author of Lessons From The Successful Investor: Lessons From The. attributes his interest in investing to Warren Buffett. His investing principles are based on value investing. Robin R. Speziale resides in beautiful Canada. Robin R. Speziale also delivers. cows for the sake of diversifying his farm. Lesson 43: The greatest returns tomorrow are from the greatest opportunities today, regardless of asset class. Lesson 44: In a successful portfolio,