Value Investing News

Big echo in here

It is still echoing!!

I consider myself an investor but I dont' necessarily call myself a value investor. I consider my strategies and ideologies to be based upon the great investors who influenced me like Ben Graham,Warren Buffett,Peter lynch, Greenblatt among others. But value investing seems redundant. It seems all true investing is value investing. This dawned on me after I read something another "value" investor wrote about this. true investing is using the idea of finding a real value and not speculating just on price. Price is what you pay value is what you get so Buffett says. So an investor in essence basically is a value investor. What's the need for value tagged before it. It seems all true investing is value investing. value investors are just known for being disciplined investors but are investors not looking for the same things value investors are?

Buffett and Munger would agree with you, as would most here. I think the distintion helps the uninitiated - everyone probably thinks they're investing.

Good question. My thoughts, at the risk of "preaching to the choir":

Buffett and Munger would not easily agree with your premise. If there was no difference between the results of Buffett and the results of Joe the investor, then all the Joe's would be as successful as Buffett. So how is value investing different from other investing?

I think the distinction lies in your objective. Where others might select investments to achieve growth, or income, or political correctness, or stability, balance etc, etc, the "value investor" looks for stocks that have a special feature that translates into "objective" (meaning quantitatively measurable & predictable) financial results in Sales, Expenses, Profits, Cash flow, etc.

The value investor does more research into the target company and understands the target in depth. The value investor is a fundamental analyst. He does not base decisions on trends of the past, ie he is not a technical analyst.

The distinction also lies in how you select your investments. Buffet and Graham define the term "intrinsic value" which is the present value of future cash generated by the business. If the investor does the research and the math needed to calculate intrinsic value, then the investment's value is the difference of intrinsic value per share less market price per share and less a safety margin, or moat which means an allowance for error and lack of perfect knowledge about the company.

And the distinction also lies in the time horizon of the investor. Value Investors tend to be holders rather than in and out traders. Value investors tend to take more time in to analyze and selet their investments. They are not in the game for the quick score, but for a long term winning record covering decades or forever.

I leave further discussion to other posters. There is a bunch more that distinguishes between value investors and other investors.

Regards
Steve

I'm shopping for brokers and wondering if you guys had any suggestions. I've got a roth IRA account with about a $28k balance and a traditional IRA with about a $7k balance. I also am thinking about opening a taxable account with about $10k. I tell you this because the balance will affect the commissions. For each account I'm probably going to split the money about 50-50 between common stocks and bond funds.

Tradeking and Zecco seem to be the two cheapest for stock trades, but I'm not sure about what they offer in the way of bonds. If anyone has used either of them I'd like to hear your opinion. And of course if any of you are using or have used someone else who you think might be appropriate for me I'd like to hear about them as well. Thank you

In this idea buffett uses the pretax earnings per share in his calculations. I was wondering to get this figure, is it simply Net Income Before Taxes divided by the amount of shares? or is there another number I should be using..