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Showing posts from 2021

How to Celebrate Your Wins and Uplevel for Next Year

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A new year is coming up and I want to give you some resources to end the year on a high point and get a great start to the new year. I realize this is going to be a long one, so let me help you out with a guide to this article. In the first part, I’ll share my best ideas about how to celebrate success. The next part is about setting goals and what to do to follow up. I end the article with some reflections of my own year. Read all sections or just the one that will inspire you. Celebrate Your Wins In October I read the book “The Long Game” and attended an HBR Webinar with the author Dorie Clark. One learning that resonate with me, is that we must celebrate even a small raindrop of success. Because raindrops accumulate (compound) over time and could lead to something bigger. And who wouldn’t like success to rain down on them?  Here are some ideas to celebrate your success: Open a spread sheet and write a note every time you have success – it could be just a “raindrop” or a big game chan

What Are the Steps to Investing Mastery?

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If you want to master investing you must practice. Earlier I’ve described and shared a monthly investing practice   but there are other ways to learn and today I’ll share Tony Robbins 3 steps to Mastery. Earlier this month I participated in Tony Robbins’ Date With Destiny (if you'd like to know more about DWD there's a documentary about it on Netflix. It's called "I'm Not Your Guru").  What I admire about Tony Robbins besides his mission to spread love and to contribute, is his approach to learning and adopting patterns. Tony have interviewed some of the best investors in the world in order to learn how to be a successful investor. Investors like Ray Dalio (please do read his books, they're so important), Sir John Templeton, and John Bogle and many other successful investors have contributed to Tony Robbins knowledge.  Even Warren Buffett gave Tony Robbins advice though I wish Buffett had shared better information with Tony Robbins because Buffett’s uniqu

Why Does Charlie Munger Say: Waiting Is the Most Important Skill?

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Waiting - can you believe patience is the most important trait for an investor? According to Charlie Munger, who is one of the most successful investors of all times, we should practise patience and excel in waiting. And waiting starts right from the beginning. Once we've done our research and found a wonderful business or two, you'll find that there isn't really much to do because your valuation showed a stock price that's far from the current stock price (because we want to buy with a margin of safety in case we made any errors in our business case). Your valuation price is $50 and the stock sells for $150 - will it ever go down? Now the waiting starts. The waiting for the stock price to come down to a great price. Once the stock price is right, and we've bought the stock an even more difficult waiting period will come, where you might experience that your stocks go down (buy more) or stagnate for a while. Or go up.  But we're not in it to sell. We hang on for

What are the Best Free Websites for Investors?

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What are the best free websites for investors? And how do you use them? I wanted to share this with you because there’s so much free information out there that can give you an amazing advantage. You can get a wealth of insights to a business and easily get an indication if the business is healthy or not by using the websites below.  Yahoo Finance You can use Yahoo Finance for news and numbers on wonderful businesses . When you do research on a wonderful business, you want to keep up to date with important news. I don’t read every single article because a lot of the updates aren’t necessarily important, but I keep myself updated. I can also see important numbers that I use for valuation of the business (calculating how much I should pay for the stock). Finance.Yahoo.com Macrotrends You can use Macrotrends for getting data back in time, for example in the investor checklist , there’s an easy calculation using PE ratio (price-earnings) to find a desirable PE level for buying a stock. The

Why are Checklists Such Powerful Tools for Investors?

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You might have followed me for a while, or you might be here for the first time – if you’ve been here before you have definitely seen me mention a checklist. Before I invest in a business, I use checklists. A checklist is not a to-do list, a wish list, or a shopping list. A checklist is a list that prevents me from making errors and in its core my goal with it is to:  1) not lose money and 2) to get a return that’s higher than the stock market average over 10 years. Not everyone likes checklists and to some people it might seem that only insecure people need checklist. But in multiple professions around the world checklist has proven to be the difference between life and death, between wealth and ruin. Pilots, doctors, and the most successful investors use checklists (Charlie Munger, Guy Spier, Mohnish Pabrai, Danielle Town, and Bill Ackman). Bill Ackman learned that the years he moved away from his checklist, was the darkest years in his investing career and when he came back to using

When Can You Buy Stocks on Sale?

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I often talk about buying stocks on sale and I thought: why not use this occasion Black Friday and Cyber Monday to share more information with you about the concept of stocks going on sale. I absolutely love buying great items on sale and some of my favorite wardrobe items are bought on sale. One time I was in Stockholm on a business trip and on my way back from the trade fair I went to a design store in the city. The store had a sale and because the Swedish currency was very weak at the time I was able to buy two designer bags at a 90% discount. 70% sale and the 20% was because of the weakness of the Swedish Krona. It was high quality purses at an incredible bargain price and I use the bags frequently and I'm so grateful to own two beautiful leader bags of a high quality. And stocks go on sale too. Let me explain how you should buy quality at a discount in the stock market. Whether we're talking about socks or stocks, I like buying quality merchandise when it is marked down. W

How to Copy The Best Investors - Buy What They're Buying

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Some of the best investors of all time does it: Copy other super investors. For example, guru investors like Charlie Munger and Mohnish Pabrai - they model the best investors and by doing that they secure an outstanding rate of return. Actually both Munger and Pabrai recommend copying as an investing strategy. But who are the best investors and how can you find out what they're buying and copy their trades? I'll share my learnings and knowledge about it in this article. I believe in the discipline of mastering the best that other people have ever figured out. I don’t believe in just sitting down and trying to dream it all up yourself. Nobody’s that smart. Charlie Munger Every quarter the holdings of top money managers in the US are published. In these documents you can see which stocks these investment managers bought, sold, and held on to. These filings are called 13F forms and reported quarterly from investment managers with $100 million or more under management. When these f

Are You Paying Too Much for Stocks?

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Taylor buys a new smartphone for $150. But the retail price of this phone is $100. Why would Taylor buy a phone for 50 more than the retail value? Buying stocks at a higher price than their value happens all the time in the stock market, and if you’re uncertain of what you’re doing when you’re investing, it could happen to you.  Buying a stock means that you own a share of a company. And a company is worth something. Think about the buildings, inventory, machines – the cash they have - and many other assets. Imagine if you had to buy that entire company today, what would it cost? A value investor wants to know what the company is worth – the intrinsic value - and then we want to know the company value per share. That sounds like quite a large task, right? To add up all the company’s assets to find out what your earnings would be – the owner’s earnings. But it’s not really when you have the right tools and an understanding of what you have to add up.  When I started investing, I didn’t

The Path To Financial Freedom

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I love my job and thrive working, but one day it dawned on me, that I would be working until I was 70 years old. And the next thought was that I have a lot of dreams about what I want to do when I retire – when I have time. Like travelling and focusing on my hobbies, spending time with loved ones. But when I retire, I might not have the health that my dreams require – maybe I do, but the risk of not being vigorous is there. And that is why I’m not only investing but studying daily and focusing on my investment cases and teaching others how to invest with confidence. The reason I started the blog is because I’m so passionate about sharing this strategy which I know works, with everyone who wants to listen and is interested in their future. I’ve been investing since 2005 and for many years I had no idea - like so many other people - about what investing really was. Or that there was a difference between speculating, trading, and investing. And I tried to find information about investing

What are my first steps? (The easy way to get started)

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The global pool of publicly traded companies is enormous and as value investors we are always chasing that “wonderful business”. I’ve found a way to quickly scan if I should continue investigating if a company (within my circle of competence) is worth continuing building a case on or if I should put it in my “too hard” box. I’m referring to a tray that Warren Buffett, the most successful investor of all time, has on his desk in his office in the Berkshire Hathaway headquarters in Omaha Nebraska. Yes, the most successful investor with a rate of return of 19 percent over 50 years have a tray in his office, where he archives companies that are too hard for him to understand. So, when the most successful investor has companies that are too hard to understand it would be good for us too to acknowledge if something is too hard. And now I’m going to share my method. The easy way to get started When I was a new investor, I would find a wonderful business by compiling a list of products or serv

Are Share Buybacks Good for Investors or Not?

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If you’ve been following news about the stock market you might have seen headlines about “stock buy-backs” or “stock repurchase plans”. In this article I’ll describe what it is, how it benefits investors, and what we as investors should watch out for. Buy backs means that companies buy back their own stock. Why would companies buy their own shares? and what do they do with those shares? might be some of the questions that pops up for you and I’ll answer these questions below. Examples of companies that buy back shares are Apple, Alphabet (Google), Facebook, Oracle, Microsoft, Berkshire Hathaway, and many more. Why would companies buy their own shares? There are several reasons why companies would buy back their own shares. Good Examples: The company has an extraordinarily large amount of cash and even after investing in growth initiatives and potentially paying dividends, there’s cash left to buy back shares. Further, the stock price is very cheap, compared the company’s real value. Wi

Eight Excellent Books for a New Investor

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I've updated the article with some new links because I have the opportunity to help a young, bright man with his college payments, and it's a son of a friend. I'm so happy I can support this way. So, if you click the links and maybe even buy one of the books using the links, you're helping a young person pay for college. Phil Town, Payback Time As you can see in the photo, my copy of Payback Time is full of bookmarks, because this book is packed with quality information about investing strategies. The book content of Payback Time and Phil Town's first book Rule One , is pretty much the same. I recommend both of the books but rather than reading them one after another, use one as a refresher several months after the first.   Guy Spier, The Education of a Value Investor This book is a story about how Guy Spier discovered value investing and how the journey shaped his life. You'll learn about the values in this honest, and inspirational book. If you prefer audio

How Can You Tell if a Company is Well Managed?

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In this article I will be diving into what performance indicators we would like to see from management in a wonderful business. This is article 2 out of 2 about Management. You don’t have to read the first article to dive into this one – both articles are stand-alone – but here the link: How do you know if you can trust the management? As value investors we have 4 parameters we’re always looking into (the “Warren Buffett way”). We want a company that we’re able to understand , and once we’re over that hurdle we want it to have management we can trust, a large competitive advantage , and then we want to buy it at a reasonable price . Now let’s dive deeper into management and how you can track their performance. Does the CEO communicate the Strategy? A company’s strategy is an extremely important component for investors. With this strategy we know where the company is headed, and we can track how well they’re doing year on year – if the CEO shares their strategy! Because it’s far from ev

How do you know if you can trust the management?

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Warren Buffett - one of the most successful investors of all times - have three parameters he is looking for before he invests in a business. The company must be within his circle of competence , it must have a durable  competitive advantage and then he wants management that he can trust. Today is the first article out of two about management. In the first one we'll get to know the managers and in the next article, I'll dive into how to spot a great management performance. Click here to read about management performanc e . You'll also find management performance numbers in my free checklist . “In looking for people to hire, you look for three qualities: integrity, intelligence, and energy. And if they don't have the first, the other two will kill you.” Warren Buffett When we talk about management of a business, we usually specifically mean the CEO - Chief Executive Office and sometimes this person is the founder of the business but in many public companies it's an

My money past versus my current spending pattern

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The first time I had to challenge my money patterns was when I was in my 20’s. At the time I thought that spending was what was expected in life (it wasn’t until much later it dawned on me that it’s not). Back then I had countless sleepless nights because I was worried about money and paying my bills. I had debt and a terrible spending pattern. One night I decided that it had to stop. That I had to change my life and that money should never again be a reason for lack of sleep. And since that day I haven't had a sleepless night because of debt or money problems.  The cure was a book by a danish author Anne-Mette Davidsen, where she asked a range of in-depth questions about my relationship with money and had me reflect on my money present, past and future. I had so many aha-moments while reflecting, and I made so many decisions to stop certain patterns and biases, that my relationship with money drastically changed from one day to the other. Some examples of ways my pattern changed