Stock Investment Checklist

This post serves as a reminder to myself every time before I want to invest in any of potential stocks.

0. is it profitable?

1. where is the moat?

2. where is the growth?

3. is debt acceptable?

4. is it selling at a margin of safety price?

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0. PROFITABILITY

a few financial metrics that needs to be consistent:-

- ROE

- ROA

- ROIC

- net margin

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1. MOAT

Brand

- a product you are willing to pay more (coke, nike, mcd)

Secret

- patent or trade secret that makes direct competition illegal or very difficult (3M, Pfizer, Intel)

Toll

- exclusive control of a market (media companies, utilities, ad agency)

Switching

- product that's too much hassle/expensive that doesn't worth switching (msft, paycheck, )

Price

- product price is so low that no competitor can compete (walmart, Home Depot, bed bath beyond)

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2. GROWTH

determines where of the growth is coming from for the company.....

- gaining more market shares

- introducing new product (eg:- Apple)

- strong brand name thru rising price (eg:- coke)

- thru acquisition (eg:- Walmart )

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3. DEBT

make sure that the company is taking debt which is repayable within a few years.

a good rule of thumb is:- 

     long term debt / net income < 5 years

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4. MOS

- calculate the market value of the company using discounted FCF or EPS:- https://docs.google.com/spreadsheets/d/1-_63EUyhIF6QEenH_HRxkHTo-3RlxqDpQjb_pfi1q4Y/edit?usp=docslist_api

- buy only if it is trading at a price which gives an acceptable CAGR and MOS.

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Living In The Present

I really love this well explained and written blog.

http://paidtoexist.com/how-to-live-fully-in-the-present/

Here are the take away points:-

why it's difficult to live in the present

because we never shut up. 

if we are constantly talking, we never hear what anyone else has to say.

likewise, if we are talking to ourselves all the time, we are never listening.

5 ways to live in the present

1. don't try to quiet your mind, just witness it.

2. you are not your thoughts.

3. breathe.

4. meditate

5. practice mindfulness.

The Secret: Law Of Attraction

dAnything that you think will become real. The thoughts doesn't know how to differentiate between positive and negative. It only understands the thoughts and we feed it.
- if we keep thinking we don't wanna be poor, then we will become poor
- if we think we wanna become rich, we will become rich.
So..... feed your mind with the things that u wanna achieve.
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Emotion controls our thoughts.
When we r feeling down, immediately put on a beautiful piece of music. Start singing. Think of something beautiful or someone we love. REALLY keep that thought in mind.
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ASK

Be very sure and clear on what you want.

BELIEVE

Believe that we have received the thing. don't doubt ourselves. How are we going to achieve it is non of our concern. That should be left for the universe to run its course.

RECEIVE

Feel the actual emotion when u really have achieved the goal. Emotion, and feeling. Important.

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Start each day/events by pre-visualizing all positive possible details/outcomes, have a great emotional state!!!

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DAILY GRATITUDE

Aaa

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A lot of people strives hard for great home, lots of money, and all these outer things in life. but all these outer things doesn't necessary guarantees what people really want, which is happiness. People goes for those outer things thinking that it's gonna bring them happiness, but in fact it's backwards. We need to go for the inner joy, inner peace, the inner vision first, and then all of the outer things appear.

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we must change our focus and begin to think about all the things that are wonderful about us. look for the positive in you! you attract what you think. all we have to do is begin with one prolonged though of something good about You, and the law of attraction will respond by giving you more like thoughts.

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It could be another way to think about things

I have to wake up early everyday.
I work long hours.
I don't have much time left for the thing I love to do.
My children only see me during the night time.
My family only sees me once a week.

We'll.  It could be another way to think about things ...

I get to do my hobby(exercise) the very first thing everyday in the morning.
I get to do the things I love(listening to music and programming) for long hours.
I get to tuck my children and cuddle them to bed every night to sleep.
And my family gets together every weekend and have some quality time together.

It gets me to look forward to everything I do everyday instead of complaining.
:)

It could be another way to think about things

I have to wake up early everyday.
I work long hours.
I don't have much time left for the thing I love to do.
My children only see me during the night time.
My family only sees me once a week.

We'll.  It could be another way to think about things ...

I get to do my hobby(exercise) the very first thing everyday in the morning.
I get to do the things I love(listening to music and programming) for long hours.
I get to tuck my children and cuddle them to bed every night to sleep.
And my family gets together every weekend and have some quality time together.

It gets me to look forward to everything I do everyday instead of complaining.
:)

What You Really Want ?

Was reading this book that we have bought from Taiwan.
It is a book which has a collection of stories about 20 some cafes and the process of cafe which has cats. :)

After reading it, it triggers my though and makes me really wanna do the same too..... but only for a brief moment though , especially after the serious thought and reality consideration kicks in

It is always easy to see what others have, and being envy and have the urge to wanna have or do what others have , but We will never understand the effort behind unless we seriously think about it,
Like for the Case, I am only seeing the surface of the things that z want. A place where I can enjoy Coffee and at the same time enjoying the cats. Operating a Cafe is a whole new thing which Comes with a whole lot of new Consideration. eg:-Going for a 2 week vacation with my loved ones beComes harder .

Sometimes it is not the destination that we r seeking for. we grow. Our needs at certain stage of life changes too.

instead of focusing on the end results and settle at a final destination, its more important to enjoy and feel the process along the way.

so, instead of asking "what do you really want in life", a better way to ask the question is....

"what do you want in life at this current stage of life?"

:)

The Difference Between Hearing VS Listening.

The Power of Listening - An Ancient Practice for Our Future: Leon Berg at TEDxRedondoBeach

http://www.youtube.com/watch?v=6iDMuB6NjNA