Richer, Wiser, Happier
William Green
Summary
Timeless investing lessons from some of the greatest investors in the world
Rating: 5/5
Notes
The crowd is always wrong
Watch out for momentum
Never borrow money to buy stocks
Pick your 10 best ideas, study them like crazy
Hope is not a method - know exactly what you’re buying
Know where your edge is (healthcare)
As long as you have faith in you, nothing will abstract you
Just copy the best ideas other people have figured out
Know the rules of the game
- You’re buying a business
- The market is a voting machine with prices that don’t make sense
- Only buy a stock when it’s less than your conservative estimate
Only buy stocks when values are so low relative to what you think
Fish where the fish are. Go to where there’s value, everything else is noise
Be patient and let the bargains come to you
Keep a solo investment advisor - you. As soon as people come onboard, you’re going to change how you act
Say no to almost everything
If something is not an obvious double in a short period of time, leave it
Avoid anything w/ financial statements that are too difficult
Simplicity rules
Be patient and selective
Make bets w/ minimal downside and significant upside
Never deal w/ leverage and impatience. Compound over long periods of time
Don’t meet w/ CEOs you’re investing in, understand the numbers
Take a simple idea and take it seriously
You have to have a willingness to be lonely and take positions other people don’t like
When you stick your neck out, you have to be self-confident enough to do it
Don’t listen to experts and trust their opinions
In the darkest of times, never forget the sun always rises
Templeton’s 6 investing principles:
- Beware of emotion is investing
- Because of your own ignorance - research as much as you can
- Diversify to protect against your own ego
- Successful investing requires patience
- Study assets over the last 5 years to find bargains
- Do not chase fads - focus on value
Choose where to place your focus because what we focus on expands
Change is inevitable, the only constant is impermanence
Being intelligent is nothing but luck
Always buy cheap and never overpay
Don’t invest in dreams, invest in what’s tangible today
The cycle of the market is always predictable
The environment is what is it - act accordingly
‘Skepticism calls for pessimism when optimism is excessive. But it calls for optimism when pessimism is accepted.’
Cycles always reverse and reckless excess will be punished
Humility, skepticism and prudence are key to long term financial success
Because the future is uncertain, always minimize risk
Many shall be restored that now are fallen and many shall fall that are now in humour
Do not cave to external pressures
Create a closed end vehicle so you can’t have redemptions
Always keep enough cash on hand so you can never go bust
Secret to investing is ‘safety’. Always think how much you could lose
Build a portfolio that can withstand various states of the world
Don’t add fragility to your portfolio (bad balance sheets, too much leverage, too much debt, bad mgmt teams)
Beauty lies in the mundane businesses, not the glamour
Invest when the company is 30% less than intrinsic value
Rules of resilience:
- Respect uncertainty
- Eliminate debt, avoid leverage and don’t spend excessively
- Become shock resistant, avoid ruin and stay in the game
- Beware of overconfidence and complacency
- Beware of exposure to risk and require a margin of safety
Figure out what something is worth and pay a lot less
STOCKS FOLLOW EARNINGS
The way you’re going to find bargains is search for places others don’t want
Buy good businesses at bargain prices
Scale economies shared can turn into great business (amazon, costco, etc.)
Resist the external and internal forces that make you act impulsively
Make your mistakes non-fatal
Live on less than you make. Invest the difference
To attain knowledge, add things. To attain wisdom, subtract things
Figure out what not to do first
Know what you own
Think about your own limitations
Find disconfirming evidence against your ideas
Start with ‘why am I wrong?’
Everyone messes up or gets unlucky, it’s part of the game
***
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Make Something Wonderful
Steve Jobs
Summary
The life of Steve Jobs in his own words
Rating: 5/5
Notes
Make something wonderful and put it out there
‘You appear, have a chance to blaze in the sky, then you disappear’
When you’re a stranger in a place, you notice thing you don’t otherwise (Jobs after India trip)
Whenever you start with nothing, always shoot for the moon. You have nothing to lose.
You never achieve what you want without falling on your face a few times
Never be afraid to fail. You never achieve what you want without falling flat on your face a few times
We are never taught to listen to our intuitions, to develop and nurture them. But if you do pay attention to these subtle insights, you can make them come true
Creativity equals connecting previously unrelated experiences and insights others don’t see
Believe that some of what you follow with your heart will come back and make your life richer. And it will. And you will gain even firmer trust on your instincts and intuitions
Make your avocation your vocation. Make what you love your work.
The journey is the reward. The reward isn’t in the pot of gold at the end of the rainbow, it’s in crossing the rainbow
To find A+ talent, if experienced, look at their track record and results
The world we know is a human creation and we can push it forward
The people who are crazy enough to think they can change the world are the ones who do (read whole ad ‘here’s to the crazy ones)
We are what we repeatedly do. Excellence then is not an act but a habit - Aristotle
Hire people better than you are
You can’t plan to meet the people who will change your life
It’s impossible to connect the dots looking forward, but they make sense looking backwards so you have to trust the dots will somehow connect in your future
Everything around you that you call life was made up by people no smarter than you
***
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