Habit #3:
Read…read…read
That’s the best habit that to can have as an investor.
That’s the best habit that to can have as an investor.
Successful investors
will tell you that if you just read a company’s annual report, you will be
better read than 90% of all investors. And if you read the footnotes
(explanations) after the financial statements in an annual report, you’ll be
better than 99% of all investors.
Warren
Buffett’s business partner Charlie Munger once said, “In my whole life, I have
known no wise people over a broad subject matter area who didn’t read all the
time – none, zero.”
Buffett
and Munger are both well-known for the incredible amount of reading they do.
And you can follow their footsteps by starting with reading a lot.
Read
books on value investing. Read books on human behaviour. Read books on the financial
history of the world. You never know when you’ll find a brilliant idea to add
to your repertoire.
Read the
daily newspapers, read the annual reports, read the biographies of successful
businessmen.
Knowledge
is power, and there is no shortcut to success. Not even in investing!
Yes, and it is related to #2. An investor need to know the language of business, and then using it to study the the financial statement
and dissect the numbers.
Apart from that, an investor can further read other related materials to equip with better knowledge. There are few information sources that an investor worth to spend time to take a look. And, again the language of business is essential knowledge before you can perform further reading.
- Analyst Report – how the professional analysts view on the company result, future growth capabilities and the valuation of the company.
- Press release \ bursa announcement – latest projects, latest development, etc…
- Industry related data – e.g. CPO price for plantation counter
- Direct experience on company product \ service.
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