Are you Investing or Speculating?
Invest in businesses you can understand and ‘put your arms around’. It’s important to establish your circle of competence as an investor. If you don’t understand what the company does, or how they make their money, their strength, their weaknesses, and competitive position how can you forecast future cash flows in order to make a proper valuation of the company? For example, take the time to understand what a company does by going to the mall or online and checking out thei