Mechanical screening

Not that long ago I used to get my ideas from various articles and tips and then try my best to do further research to make the ideas ‘my own’. Unfortunately this is a bit like trying to learn how to play darts by watching a monkey play. One of the things I haven’t explained here yet is how I screen for the investment ideas that go on my watchlist. Continue reading

Thinking like a trader

Are you a trader or an investor?

Trick question – the ‘correct’ answer is both (or neither). But underneath this flippancy lies an important distinction – ‘investing’ and ‘trading’ are not mutually exclusive but are different ways of thinking about buying and selling shares.

I’ve always thought of myself as an investor, but recently I’ve started to wonder whether if I want to make real money it would help to think a bit more ruthlessly about winning the game, like a trader. Continue reading

Ranking the watchlist

In my last post I mentioned that I intended to more clearly record my shorthand assessments of the quality of the various shares on my watchlist. Doing this could help to clarify both how I am adding certain shares to the watchlist and how I am deciding which of these shares to add to my portfolio when funds become available.

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Identifying quality

Identifying high quality businesses is undoubtedly the key aspect of my investing strategy. If I get this right then I will benefit from the magic of compounded growth over time from businesses that are in general likely to be undervalued. In an ideal world I should be buying the kind of shares that I can ‘buy and hold’ forever.

This post is an attempt to bring a bit more structure and clarity to how to assess quality and to unpack some parts of it in a bit more detail. Continue reading