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35+ years as a private investor, college finance/economics adjunct lecturer, corporate project engineer and business development strategist, individual and small business tax preparation. Corporate experience in communications and energy BS Mechanical Engineering - Carnegie Mellon University MBA... More
  • The Great Investors Are Always On The Job 0 comments
    Jun 7, 2013 3:09 PM

    Everyday information overloads the left brain. The DIY investor must synthesize all that data using a detective-like style; knocking on doors, pursuing leads, following up with interviews and verifying the claims that are made. Using that everyday data, refining it down to investment information, a true investor is always on the job.

    Example: When Sam Walton decided to expand Walmart's reach into a new territory, he would hop into his airplane and take a look at the traffic patterns of the area where he was considering to erect his next store, from the air. He coveted simple everyday information and was always "on the investment job." When he vacationed with his family, he visited as many retailers as he could, not just his competition, but all retailers, looking for ideas to transplant (a euphemism for legal theft) into his own stores. They included parking lot layouts, in-store traffic patterns, kiosk layouts down the larger aisles and which impromptu, salable items to display to the impulse buyers as they waited in line to complete their transactions at the store. The great investors are always on the clock, observing, informally interviewing managers and listening to, and questioning, the patrons of the business.

    Wall Street analysts, the Business newspapers, the Business cable networks and the investor message boards are not the only venues for garnering investment ideas. Talk to and listen to your family, your friends and neighbors about their experiences, their jobs, their school work, their hobbies and especially where they spend their money.

    Peter Lynch, the Fidelity investment manager who ran the flagship Magellan Fund, received some of his best investment advice from his wife and three daughters. After a trip to the mall, Lynch would casually quiz them on where their best retail experiences occurred, but he did not stop there. He would follow up with a visit to the company, where he and his cohorts would interrogate the senior management as if they were applying for a job in Lynch's portfolio at the Magellan Fund.

    So next time you are at a barbecue with the neighbors and family, get that little black detective's book out and seek out your next best investment idea.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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