Finding The Edge
The reason why we make basic investing articles is due to our decision-making bias.
Our decision-making weighed heavily on the first impression. Attractive politicians often win the election. Surprisingly, even we are far away from the evolutionary phase, we still fall into the physiognomist. We believe that person’s character is reflected in his face: Henry Cavill for Man of Steel and RDJ for Tony Stark.
Problem is, our first impression about anything is often wrong – including investing. When we see a girl with sexy cleavage, we assume that she is flirting. When we read the term “fundamental analysis”, we simply think about financial series. When we read margin of safety, we assume it is about buying undervalued stock. When we see dividend investing, we say that it is about investing in stock with a high dividend yield.
Actually, they aren’t.
From our first years of investing till today, almost no investment resources cover and fix these kinds of misconceptions. We believe such misunderstanding will prevent investors from the optimal outcomes.
This circumstance is like looking at an object through the dirty – old – blurred glass. You can’t make the best decision before you set the glass clean.
Article in this category provides a cleaning kit. We scroll to the bottom of investing building block, finding the misconceptions, and present the right ideas for the reader. We try to change your first impression about some of investing concepts. Once you get the proper insight, you are one step closer to the valuation.
We believe our article that explains the Margin of Safety brings you here. This post is the sequel of that series. Differ from the prequel, this time we will elaborate further on the Margin of Safety application.
Continue reading “The Margin of Safety Application: Misconception”
Many resources – whether it is Reddit thread, YouTube video, or blog – often quoted what Warren Buffett says and what he writes. Unfortunately, only a few (including us) give a deep analysis of Oracle’s portfolio. We believe, looking carefully at his portfolio, investors could understand more about Warren Buffett Investing Strategy.
Continue reading “Warren Buffett Investing Strategy. Berkshire Monopoly”
The formal definition of margin of safety is buying the stock below the intrinsic value. This official definition doesn’t help in practice. Here we offer some thought to help investors grasp this iconic idea.
Continue reading “The Margin of Safety: Why Value Investor Miss Tesla”
The stock price of Santa Clara-based company rises from 535 to an insane 3,554 from 2012 to 2020. During that period, only once did it record positive earning. What is investing lesson from Palo Alto Network (PANW)?
Continue reading “Investing Lesson from Palo Alto: Vision-Driven Stock”
Some investors may confuse differentiation products with a durable competitive advantage. They assume that the production and fixed costs could be distributed among different kinds of products, thus could sell their product lower than competitors. Well, is it true? Starting from this, we are going to develop some competitive advantage analysis of differentiation.
Continue reading “Competitive Advantage Analysis of Differentiation”
The best timing to buy Amazon stock is when Jeff Bezos works in his garage(1). We are going to evaluate this investing strategy by answering the question of when to buy and sell. In that process, we incorporate the business life cycle as a guide.
A good product doesn’t always come with durable economic advantages. Sony makes high-quality DVDs, but you can replace them with Verbatim without much issue. Investingdeck.com tries to resolve one of the misunderstandings about the economic moat. Welcome to our intangible asset analysis.
Continue reading “Intangible Asset Analysis: Misunderstanding Moat”
Try to check headlines in some of investing media (blog or youtube channel). You will find articles like: “Why Nvidia rise 10% today” or “S&P500 down 5% due to job report.”. Or try to read conversations in the community like Reddit, ” Panasonic is battery stock due to its status as Tesla supplier.” We tell you, this is not fundamental analysis.
Continue reading “Fundamental Analysis: Why Does It Go So Wrong?”
Microsoft has transformed its centerpiece of growth from Windows to Azure, at least according to its publication. Unfortunately, you will not find Azure as one of the business segments in Microsoft’s official report. Today we try to bridge that gap, we will cover how Microsoft makes money today through our Microsoft Business Model.
Continue reading “Microsoft Business Model: Looking at The Blue Sky”
In 2016, Warren Buffett via Berkshire Hathaway bought Precision Castpart – a company that has soared 20 times in the last 13 years. Its revenue grew four times only in the same period. The Oracle of Omaha believes that due to its economic advantage, Precision Castpart deserves that valuation. Here we try to fix the misconception about value investing. Spoiler alert, value investing doesn’t necessarily invest in cheap companies (low P/E, low PBV). Investing in a growth stock is part of value investing
Continue reading “Investing in Growth Stock: Redefining Value”