Latest: Course Last Update: June 2017
Join 1996 (almost 2000! :-) ) Delighted Students Already Enrolled In This Course!
- If you want to learn more about the stock market and effective ways to start investing in it,
- If you are looking for ways to consistently beat the stock market,
- If you are looking for ways to consistently beat the stock market, while putting in a minimum amount of effort,
This course will be perfect for you.
This course aims to teach you the investment insights needed to identify extraordinary businesses and invest in them, not from a speculative point of view, but from a business like one.
This course aims to show you how you can outsource most of the effort by relying on all kinds of costless web-based platforms, tools, analysis, and much more. The same ones that I use myself.
The goal of this course is to make you a better investor, to provide you with a thorough & practical understanding of how to search for, analyze and buy great companies' shares.
This course is about teaching you how to protect your initial investment principal while laying out a good investment strategy for the years to come. This course is for investors with a mid to long term mindset.
Note that there is a guaranteed 30 days refund, in case the course would not live up to your expectations. However, I have put in a lot of effort into creating the numerous lectures and I truly wish for you to become a better investor. So do not hesitate to give me your feedback if you have identified improvement points.
Are you ready to become a better investor, realizing higher gains at lower risk?
Are you ready to learn how to decrease your effort in doing the necessary due diligence?
This course will help you – in just a couple of hours!
General introduction of the course
- What type of aspiring investors is this course for?
- What kind of equity investments are you looking for?
- What are the objectives and what will you learn / can you expect from this course?
This course explains the use of ETFs or Exchange Traded Funds and how you can rely on them to track the performance of the stock market:
- An ETF is a low cost investment fund that tracks the movements of an underlying stock market index as closely as possible.
- The stock market's long term trend is a rising one, meaning that the patient investor will always make money.
The Dollar Cost Averaging Technique is an easy and straightforward technique that, if combined with investing in ETFs, allows you to consistently beat the stock market, and at low effort.
Throughout the remainder of the course, the SAIM method is used:
- Screen the large available pool of equities for stocks that are worthy of further research
- Analyse the business from a fundamental perspective i.e. from a business, financial, management & valuation point of view, as well as from a technical analysis perspective
- Monitor your portfolio periodically, to make sure it continues to outperform the market
By taking this lecture, you will get acquainted with stock screening tools i.e. software that filters out the companies that satisfy specific constraints that you can define up front. This way, you can identify the couple of businesses that are really worthy of researching more profoundly, and hence, you can save yourself a decent amount of time.
This lecture shows you several ways of how you can outsource and hence minimise the screening effort.
In this lecture, you'll learn how to start analysing a business from a high level perspective, and get a good starting point for building your further analysis on.
- Getting acquainted with the company's fundamentals (financials, operating metrics,...) through Morningstar
- Develop an understanding of the company's products, markets & values on the company website
- Develop a more critical understanding of the company on several levels via the SeekingAlpha platform
- Getting a sense of the actual environment of the company through news articles
- Reading the annual reports
In this first lecture around Value Investing, we take a closer look to the "father" of value investing: Benjamin Graham.
This lecture discusses the seven criteria a company needs to pass in order to be investment worthy from a defensive value investor's point of view:
1) Adequate size of the company
2) Sufficiently strong financial condition
3) Earnings stability
4) Dividend stability
5) Earnings growth
6) Moderate Price to Earnings
7) Moderate Price to Book
In this lecture, we'll take a closer look to the seven Graham criteria applied to a practical example for Apple. Make sure to download the template in the download section.
In this lecture, you'll become acquainted with the background of one of the world's most famous investors: Warren Buffett. We'll also take a closer look to how his initial portfolio performed over its first decade.
Warren Buffett has at least four famous investing gurus as his mentors, who taught him several investment principles that he still uses today:
- Circle of Competence
- Focus investing
- Paying a fair price for great companies instead of always trying to buy companies below intrinsic value
- Consistency in growing profits
- Why the business should be easy to understand
- The Circle of Competence concept
Consistent profit margins are more difficult to attain than one might think, due to economic laws.
Buy companies that you believe will be successful & profitable for the long term
Look at steady track records
Look for companies that have big moats i.e. large & sustainable competitive advantage(s). Moats can be obtained through any of the following:
- Intangible assets like Brands
- Intangible assets like Patents
- Cost advantages
- Switching costs
- Network effects
In this lecture, we take a closer look at how the company's management behaves when allocating its capital. Does management allocate its capital rationally?
- If the business can reinvest its earnings at a return higher than its cost of capital...then it should reinvest its earnings
- What if the business can only reinvest its earnings at or below its cost of capital
It is important that management communicates openly and candidly towards its shareholders:
- Does management report financial performance fully and genuinely?
- Does management explain why incurring short term losses is necessary to win in the long term?
- Does management exhibit honest explanation, rather than excess optimism?
As managers typically are unwilling to look foolish in the short (quarterly) term, there is a lemminglike tendency of corporate management to imitate the behaviour of other managers, no matter how silly or irrational that behaviour might be. This lecture explains why this tendency exists, and why and how you as an investor should try to find a company that is managed by executives who resist this imperative.
According to Buffett, two of the most important financial metrics that point to an extraordinary business with a moat, are Return on Equity (ROE) and Return on Invested Capital (ROIC). This lecture explains these two metrics and provides illustrations as to why Buffett bought specific companies.
Owner earnings are the net cash flows that the owners can expect to receive over the lifetime of the business.
Owner earnings per share = dividends per share + change in book value per share
It is not enough to increase sales over time, sales must be converted in consistent profit margins.
The one dollar premise requires that the company has created at least one dollar of market value for each dollar retained and reinvested in the company.
This section explains how to value a company. The valuation of a business is based on John Burr Williams' definition i.e. the value of a business equals the total of net cash flows (owner earnings) that are expected over the life of the business, discounted at an appropriate discount rate. The different components are discussed throughout the subsequent lectures.
A company's projects and investments should all be evaluated against its cost of capital. Only if the project's return is higher than the company's cost of capital, it makes sense from a financial point of view to execute the project.
To value a business, the total of net cash flows expected over the life of the business, have to be discounted at an appropriate discount rate. This discount rate is the weighted average cost of capital or WACC. This lecture explains both high level and in theoretical detail how the WACC is calculated and what it consists of.
To value a company, two things are needed: the WACC and the expected cash flows over the lifetime of the business. This lecture explains how the cash flows can be obtained and how they should be modelled against the WACC to obtain a reasonable value range for the company.
Make sure to download the template in the download section.
In this lecture, some other valuation methods are discussed, such as the Gordon Growth Model.
This lecture introduces you to the most relevant technical analysis basics such as:
- upward and downward trend channels, resistance and support
- (reverse) head and shoulder pattern
- double top and double bottom
- horizontal support
- rising / falling wedge
This lecture explains the difference between the three families of technical indicators and provides practical examples of the most relevant ones, such as the MACD and the RSI indicator.
Deciding to invest and how to build your portfolio.
Every once in a while, re – evaluate your investments based on the exact same principles you applied in deciding whether to buy them
- How have the underlying business characteristics evolved? Does the company still possess that attractive moat? Has the company become prone to significant competitive forces? How is the industry evolving?
- How has price evolved? Is the company still undervalued, adequately valued, or has it become extremely overvalued?
- How is its financial position? Has it taken on a significant debt load? How have owner earnings evolved?
- Is management still shareholder friendly? Has management changed over the past period?
- Is the proportion that a specific investment constitutes in your portfolio still justifiedor has it become too large?
- Are there companies that are currently that overvalued that they pose too much downside risk to your portfolio?
Ruben is an experienced management & strategy consultant and investment adviser. He holds a Master of Science degree in Applied Economics and Business Engineering and two postgraduate degrees amongst which one in Investment advising & Advanced asset allocation. He has also been heavily involved in the implementation and go-to-market of the first Robo advisor in his country and is currently leading the startup of one of the next generation fintech robo advisors.
Ruben's passion is investing in companies from a business – like vantage point, i.e. not merely guessing and speculating, but really trying to understand the business and when encountering an exceptional one, investing in it for the mid – to long term. He focuses mostly on value investing, growth investing and dividend growth investing.