SMU E.y.E - FA   

SMU E.y.E Fundamental Research Cell Group Meetings

Hi guys,

Thanks for the posts Ongjeremiah and Businesslike, in addition, i'll like to add that if u are planning to invest in stocks on the SGX, be sure that you check up on the global demand of the industry that you are looking at. The reason is this, the industry might be doing well. But are they doing well at a decreasing or increasing rate? Is the global demand cylindical in nature? Always try to get some macro idea for global demand of the industry you are looking at. Then once u are done with that, go back to the  company's accounting figures and do your ratios, checking of management.. etc... then make your call.

The time to go company hunting is just about anytime really, seize the day and go look for a company you like. U may not buy it there and then, but u will know when is the RIGHT time to buy.  =)


Cheers,

Joeyhops




 

 

I really agree with BusinessLike that accounting really forms the fundamental understanding to be good in equity analysis. The knowledge is very useful when digging up the fine prints in the annuals reports, and understanding their significant accounting policies. 

What I hope to give my 2 cents is that a great accountant may not make a great equity analyst. Good understanding not just in accounting analysis, but competitive strategy or strategic analysis, prospective analysis (forecasting), and financial analysis (key ratios, metrics), Management analysis are also very key. It seems to me that being a jack of these trades would perhaps be a more cost-effective strategy in becoming a good equity analyst, as you probably wouldnt have time to master all of them.

All areas are crucial, but I thought the most difficult being forecasting and management analysis. This is where experience, understanding of the industry value chain, the company's business model, as well as the evaluation of the key management really counts. Good accountants really go a long way to be good equity analysts.....

Hope this helps. :)  

 

I think for any person trying to do more Fundamental Analysis, you should work on your accounting. For basic accounting, refer to any principle of accounts or Horngren Basics of Financial Accounting. Learn your debits and credits. I think one should really pursue accounting if you want to be a great investor. So read all your accounting books.

I think a book I really like is the Warren Buffett Portfolio and The Warren Buffett Way. I think they really work.

 

I think some great book that we have in our E.y.E. library for novince are

1. Learn to Earn by Peter Lynch
2. How to Think Like Benjamin Graham and Invest Like Warren Buffett
3. Damn Right! - Behind the Scenes with Charlie Munger

I've benefitted greatly from reading Warren Buffett's annual letter to shareholders available on http://www.berkshirehathaway.com/letters/letters.html

 

 

 

Hi all,

 

Perhaps it will be good if the Research Director for Fundamental Analysis in SMU E.y.E give us some good websites or books to start reading up on before we commence our Research Program in Week 4 of Term 1?

 

Are those books available in the SMU E.y.E Library as well?