A Book on Value Investing
Wednesday, February 1st, 2012A medium-sized publisher has approached me to write a book on value investing. I might do it, or I might not. I also might try to do it with another publisher, or I might do it through Amazon. I solicit advice from my readers on the prospect.
Anyway, I thought about what the book might look like, and to do so, I went through the entirety of my Value Investing category, and my page called Major Article List, which described my best articles from my RealMoney days.
What you will see after this is less than a first draft of chapters. I plan on categorizing it and simplifying, but here it is for now:
- Bonds
- Use of cash – buybacks, dividends, strategic use, delay
- Valuation
- Cycles
- On being wrong – planning for failure
- On financial companies
- Growth expectations
- Following leaders vs surfacing your own ideas; who are you playing with/against?
- Weighing vs Voting
- Use of free cash by management
- Avoid buggy whips
- Industry analysis and economic sensitivity
- Embrace trends, resist trends
- Take prudent risks
- Three year horizon
- Understand balance sheets; quality, anomalies
- Management incentives
- Discipline: tie your hands, do something, but don’t react; you are you own worst enemy
- Risks, not risk
- Markets are mostly, but not entirely efficient
- Margin of safety
- Diversify, but not too much
- Safe assets and Risk assets
- Avoid complexity; embrace complexity
- Sum of the parts
- Realistic expectations
- On shorting
- Ask the opposite question
- Rank your ideas
- No, macroeconomics *does* matter
This could be one, two or three books depending on me and the goals of the publisher. As I read through my blog, I realized that I wrote a lot more about value investing at the beginning of this blog. I think the crisis caused me to shift.
But as I went through what the book could look like, I got more excited about it — there is a lot of potential here to explain value investing in a comprehensive way to readers.
PS — Any publisher contacts that you want to share are appreciated. Thanks to those who have given me advice so far.
