Five don’ts & five more don’ts

Five Don’ts &Five More Don’ts of Investing

By Jae Jun

www.oldschoolvalue.com

What You Will Learn1. Who the heck is Philip Fisher?2. Common stocks and uncommon profits3. Five don’ts in investing4. Five more don’ts you need to follow if you

want to succeed

ForewordAs I continue reading one of the greatest investing books, Philip Fisher’s Common Stocks and Uncommon Profits, I thought I’d share some “Dont’s” in the book before I do a book review later on.

Who is Philip Fisher?For those that are unfamiliar with the name, Buffett tells us that:

I’m 15 percent Fisher, and 85 percent Graham

but obviously, this ratio has been changed dramatically now.

During his time, Fisher was considered “old school” in his ways:

● too laid back● nature lover ● walkaholic (not workaholic)

He also believed that brokers, “know the price of everything, but the value of nothing.”

Five Don’tsThis list is compiled from Fisher’s book, Common Stocks and Uncommon Profits.

1. Don’t buy into promotional companies. Example, IPO’s are sometimes referred to as “Illustrative Purposes Only.”

2. Don’t ignore a good stock just because it is traded “over the counter”. Not all OTC stocks are penny stocks.

3. Don’t buy a stock just because you like the “tone” of its annual report.

4. Don’t assume that the high price at which a stock may be selling in relation to earnings is necessarily an indication that further growth in those earnings has largely been already discounted in the price.

5. Don’t quibble over eighths and quarters.

Five More Don’ts1. Don’t overstress diversification2. Don’t be afraid of buying on a war scare3. Don’t be influenced by what doesn’t matter4. Don’t fail to consider time as well as price in

buying a true growth stock5. Don’t follow the crowd

Jae Jun (jae.jun@oldschoolvalue.com)http://www.oldschoolvalue.com

Old School Value improves your investment decisions and performs deep fundamental analysis and

valuation for you. Just like a personal stock analyst.