Value Investor: when to buy

[Temperament]

[quote='CityFarmer' pid='35402' dateline='135139

8381']
6. It is important to have both sides of your brain working, not just the left sides. – The side that is good at math and organization.

IMO, the math (Left brain) does the ground work, then the creativity (right brain) takes care of the rest. This seems is the best model to work on engineering work, and also in investment.

Wow! i suppose you have NO.6 And if you practise No.1 & 7, then you sure “ 包吃 ， 发财了。 恭 喜。

Knowing is just half of the story, we need executing to complete the full story

The hardest part usually is the execution.

Yes! No one could say it better than W. Shakespeare:-
"If to do were as easy as to know what were good to be done, chapels would have been churches and poor men's cottages princes' palaces."

Even if you do, you may chickened out sooner or later (like me). Or you may run out of investible fund. Or you want to do assets allocation.

[gwMoat]

Investing is simple but not easy - WB

To the extend that we research, discuss, analyse, think, behave, act or fail to act, trying to find the holy grail of investing..still we got doubt!

The important thing is, many here (i guess) already seasoned investors, able to navigate thru the maze of numbers, ratios etc and have enough wisdom and self awareness are sharing their knowledge.

That goes a long way toward "simplifying" the investing process.

[CityFarmer]

There was one advice from mentor

"To understand it, we need to simplify it. Unless it can be described fully in simple sentences, you do not understand it"

"To use (execute) it, we need to complicate it. Unless your plan covers all complications, do not execute it"

To share...

[Temperament]

In that case nothing can be more simple then "Buy Low Sell HIGH"
Just do it. But can you?

[tau281290]

Hi Temperament, your article is amazing and it pretty much sums up what I have been learning over the years.

1. The ability to buy stocks while others are panicking, and the ability to sell at a time when other investors are euphoric.

I think buying in panicking situations isn't that hard for me, but selling at the truly euphoric time is more of a challenge for me.


2. The great investor has to be obsessive about playing the game and wanting to win.
Isn't that true for anything you really want to succeed in?

3. The willingness to learn from past mistakes.
Knowing your past mistakes and not repeating them are so radically different.

4. The fourth trait is an inherent sense of risks based on common sense.
I think this point is referring to those who normally do things recklessly and those who don't. Those who are the loudest in the playground back in primary school would be those with the least risks based on common sense in my opinion. It is like those who enjoy roller coaster rides compared to those who don't. The latter are the ones most suitable for investing.

5. Great investors have confidence in their own convictions and stick with them, even when facing criticism.
Investing is never a sexy business. Look at all those "hippies" going into investment banks in the last decades thinking they have struck gold. They do not understand the slightest bit about investing. No more after 2011, Investment banking is no longer sexy anymore .


6. It is important to have both sides of your brain working, not just the left sides. – The side that is good at math and organization.
Yes, this is so true. Back at university days, I did Finance and Economic History, I was trying to balance out science and art. What I did was super rare. Most people did straight analytical courses and do not really understand the importance of art in investing. And for those who did straight art courses would never have the ability to crunch all those numbers needed for investing.

7. And finally the most important, and rarest, trait of all: the ability to live through volatility without changing your investment thought process.
Yes, nothing is smooth sailing, just don't bother looking at the volatility when it is not in your favour.

[Temperament]

Hi Temperament, your article is amazing and it pretty much sums up what I have been learning over the years.

1. The ability to buy stocks while others are panicking, and the ability to sell at a time when other investors are euphoric.

I think buying in panicking situations isn't that hard for me, but selling at the truly euphoric time is more of a challenge for me.


2. The great investor has to be obsessive about playing the game and wanting to win.
Isn't that true for anything you really want to succeed in?

3. The willingness to learn from past mistakes.
Knowing your past mistakes and not repeating them are so radically different.

4. The fourth trait is an inherent sense of risks based on common sense.
I think this point is referring to those who normally do things recklessly and those who don't. Those who are the loudest in the playground back in primary school would be those with the least risks based on common sense in my opinion. It is like those who enjoy roller coaster rides compared to those who don't. The latter are the ones most suitable for investing.

5. Great investors have confidence in their own convictions and stick with them, even when facing criticism.
Investing is never a sexy business. Look at all those "hippies" going into investment banks in the last decades thinking they have struck gold. They do not understand the slightest bit about investing. No more after 2011, Investment banking is no longer sexy anymore .


6. It is important to have both sides of your brain working, not just the left sides. – The side that is good at math and organization.
Yes, this is so true. Back at university days, I did Finance and Economic History, I was trying to balance out science and art. What I did was super rare. Most people did straight analytical courses and do not really understand the importance of art in investing. And for those who did straight art courses would never have the ability to crunch all those numbers needed for investing.

7. And finally the most important, and rarest, trait of all: the ability to live through volatility without changing your investment thought process.
Yes, nothing is smooth sailing, just don't bother looking at the volatility when it is not in your favour.

TQ for your reinforcment.
i have more or less trying very hard to practise what this article trying to say, unknowingly for 23+. Alas, i don't have all the qualities mentioned. i know definitely i have very little of NO. 6. Simple arithmetic still passable. Additional maths will kill me. If i have the rest i am very happy already. i sound quite greedy, right?