Practice experience defensive tactics of counter-investment Money Tips

Category: Money tips Release Date: 2006-06-12

Investment in the most invincible defensive tactics happens is back. Investment in defense is stressed that the capital's security. This is the master of all investments placed great emphasis on the principles of Graham taught Buffett has been earnestly: "Investors have two of the most important rules: the first is not to lose money, the second is not to forget the first."

Defense is stressed that the capital investment in the safety of

. This is the master of all investments placed great emphasis on the principles of Graham taught Buffett has been earnestly: "Investors have two of the most important rules: the first is not to lose money, the second is not to forget the first."

Margin of safety is emphasized that the first principle of value investing, the importance of placing all investment principles. Value investors often invest in investment securities to calculate the safety margin, the margin of safety is like a football match on the back line of defense is strong enough to determine the ultimate success or failure of investment. Buffett's Berkshire in 1992 in the annual report said: "We believe that this 'safety margin' principle, Graham, with particular emphasis on this point is the cornerstone of investment success." Margin of safety is the eternal principle, so that value investing goes beyond any other investment strategy has become a real investment in science, the doctrine of value investing is a real defensive counter-attack tactics textbook. Investors to comply with this principle even mediocre qualifications may also be a good benefit.

Waters Colaos 30 late in the 20th century in the New York Stock Exchange under the tutelage of Graham School, from 1955 started to operate their own funds, in the next 45 years, he had only a very simple office, never access customer and rarely talk with analysts, nor the Internet. He only believed in his own judgments and abide by Graham's investment principles: to buy cheap stocks. He expressed concern that the company's business and concentrate on a listed company's financial statements each quarter to find that the stock price lower than the book net assets of stock. He achieved a 15.3% average annual compound rate of return, the income level of the disciples of Graham is not really high, but has far exceeded the Dow Jones average.

Investment in the offense has a sustainable competitive advantage is the election of a super star enterprise. Defense is a prerequisite for success, but not sufficient condition for winning back is the key to success not only to attack the defensive winner. Italy striker sharp enough, the French team also has Henry and Zinedine Zidane, such an offensive master. Outstanding competitive advantages in the enterprise, as the super soccer team striker, has exceeded the industry average of super-profitability in the long run will certainly have a much higher than the value of the business value. Buffett selection criteria for super-companies are: 1, performance is the ability to know and understand; 2, there is a good long-term development prospects; 3, from honesty and integrity of people management; 4, be able to buy an attractive price .

Defense, then attack. The reason is very simple, it is this simple approach can no longer be a simple investment in a number of remarkable achievements in the investment guru, so Buffett said: "Because value investing is very simple, it does not teach that it is willing to professors. If you have made Dr. degree, and for many years with the use of mathematical models to study complex calculations, and then you come back to learn value investing, which is like a Buddhist pilgrimage to the Western Paradise, only to find anyone who knows more than enough to do good things. "

Simple things are often unwilling to comply with the annoying. Football fans view, the defensive back is a kind of "ugly" in football, full of passion, football is enjoyable and Hangyunliushui nice football, so Brazil, Argentina, Germany, these failures have more fans of the team. However, in the team competition appears to target only one: Hercules Cup, so go its own way the team is still playing the defensive counter-attack. The World Cup has been continuing media lament: " 'ugly' football becomes stronger, filled with utilitarian overtones, can be said that the World Cup so far have died."
And investment has always been utilitarian to come back the most successful defensive invincible weapon have no reason to be abandoned. Although in some eyes of investors, value investing for the long-guarding the few stocks, but also a kind of "ugly" investment, than chasing band, however, there is a frequent trading even more difficult to inhibit pleasure, but this pleasure is often the result has led to investment losses defeat lose.

Therefore, investors should never forget: The first objective is to invest in profit. Like football team win the World Cup feeling, what can be more profitable than allow investors to have a relaxed and happy like a wonderful idea?