The Investor Trait And How Buffett Would Find, Analyze And Value Stocks

I definitely have lazy areas.

When it's cold and raining, I don't want to take my dogs out to the park where they'll get wet and muddy and I end up having to bathe them.

Being in Seattle, it's a huge hassle during the winter months where it drizzles constantly.

So I have a lazy man's way of giving them exercise.

  • Playing fetch up and down a flight of stairs
  • Hiding treats inside their ball and then playing fetch
  • Setting up a fake grass patch on the balcony for them to do their
  • But don't you find that this is so similar to what we do when it comes to investing?

    Instead of performing the daily practice of finding companies, going through their financials or numbers, reading reports and making a decisions, we tend to take the lazy man's approach to investing.

  • Copying other people's ideas
  • Looking for stocks to buy, instead of looking at ways to improve processes
  • Buying a tiny position of 30-40 stocks to diversify against ignorance
  • Investing is hard.

    But the process and rewards are worth it if practiced regularly.

    I've been writing regularly on this blog since 2008. That's 7 years of writing one or more articles a week at an average of over 1000 words per article. But even after 7 years, if I go a week or two without writing, my brain feels slow.

    When I don't go through financial statements for a week, or fall out of rhythm in reading reports, the speed at which I pick up information feels very sluggish.

    And when my head feels drained and slow, what do I feel like doing?

    I start looking for short cuts and easy ways out.

    But I take pride in being a value investor and doing the work when picking stocks.

    It's not the same for everyone though. If you're reading this blog, it's because you like to learn about investing and enjoying being empowered to value your own stocks without seeking other's approvals.

    Take a look at these interesting trends on investor sentiment by comparing 3 approaches.

  • stocks to buy
  • stock analysis
  • value a stock
  • Investor Sentiment Over Time | Enlarge

    Stocks to Buy

    The huge blue spike is from the 2008 and it's actually very interesting to see how many people were looking for stocks to buy during the crash. But you can also see how much more volume there is (not surprisingly) compared to “stock analysis” and “value of a stock”.

    The interest also looks to be going up with plenty of interest in 2014 and 2015.

    Based on the latest data from Google Trends, most of the queries on “stocks to buy” is coming from Canada and USA.

    Click to Enlarge

    Stock Analysis

    Going back to the line chart, the interest for stock analysis looks to be steady with a slow downtrend.

    I'm not surprised because most people don't care about analyzing a stock. Anything that requires work will see a downtrend over time.

    What's surprising is where all the interest comes from.

    Click to Enlarge

    People in Bangladesh and India make up the bulk of the data but I've also found that I get a lot of emails and questions from Indian investors with strong desires to learn.

    Value a Stock

    Stock analysis and valuing stocks should go hand in hand right?

    Not so fast.

    Click to Enlarge

    It's back to the USA on how to value a stock.

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