Over the years, I’ve developed a lot of rules for investing. These rules are meant to stop me from doing foolish things and over time, these rules have saved me a fortune. I am now adding another rule—You Can’t Argue With Stupid. Let’s face it; some people just are not cut out to be public company CEOs. Everyone has their skills. Some guys are Read More

There are lots of ways to look for interesting stock ideas. I have found that insider buying is one of the best indicators of future stock performance. It operates under a very simple principle. Insiders know more about their business than you do. When they think it’s a good time to buy, it usually is. In fact, it is so simple; I’m surprised that Read More

The equity markets are surprisingly efficient. This is because most people are quite capable of looking at price earnings multiples and finding the ‘cheap’ stocks. Of course, some businesses are better than others. The better businesses normally trade at higher multiples and the worse ones trade at lower multiples. Amazingly, the market is quite capable of sorting this process out. With the addition of Read More

Let’s face it. Running a business is difficult. Nothing ever goes as planned. There are surprises. Things rarely happen on time or on budget. You need to be a realist about this. If you invest in a company and it doesn’t work out right away—you aren’t always wrong. Sometimes things just take time. I cannot emphasize this enough. Many of my best winners took Read More

I’m in Gundagai New South Wales at a charming café having buttered toast with canned spaghetti on top. I’m told it’s an Aussie delicacy. I’ve driven nearly 500 km from Sydney and have already had my first epiphany. It is said that generals always prepare to fight the last war. This cannot be truer when it comes to investing. For decades, currencies have fluctuated Read More

Let’s talk operating leverage—or as I like to call it, gearing. Think of your car, you start in neutral, shift up to first, then second. The real speed is when you hit fifth. It takes time and momentum to get there. Gearing is where the real money is made. When you are investing in little companies, you want to look at rapidly growing businesses. Read More

To me, investing is about making the most money possible while taking the least possible risk. To do that, you need to figure out where the big gains exist. Study after study has shown that over the past 100 years, smaller companies share prices’ have outperformed larger companies—often by a massive margin. Let’s face it, Wal-Mart is a well run company. It could double Read More

Selling is always the hardest part of investing. If you get the investment wrong, you should sell. It’s simple. Your only real decision is if you sell right away because things are about to collapse or if you should wait for better prices. This is on a case by case basis. A lot of the time, you just get tired of holding an investment. Read More

Everyone tells you that they want to buy cheap stocks. What does that mean? There are so many metrics out there: price to sales, price to book, price to earnings or cash flow. Which are the key ones? I think people get caught up too often looking at a few key metrics and they lose sight of the bigger picture. In the end, most Read More