The Best Long-term Investment

I made the plunge recently and invest on a course, conducted by Mr SS Sandhu. The course is Analyzing Financial Statements and is hosted by SGX Academy.

First off, the changes it made to my attitude to investing.

It might changes my approach to investing. My main strategy in investing is looking for $1 companies that cost 60cents. Hence, my first step is to look at companies that have recorded a significant drop. However, perhaps this time round, I should be reading the news a little more proactively, as they might spell an improvement to a company that has not suffered a discount.

I have taken a significant interest in the board and senior management. I used to look at management as something generic, but now I realize they could bring certain value to the company:
- They could have ties to important government/ financial institutions
- They can have (or not have!) experience that is useful.
- Their background can suggest if they have the competence for the job.

I adopted a deeper appreciation to the balance sheet, the quality of its assets, and the details of its liabilities. Not all assets are equal; every liability deserves a closer look. Hidden assets (and liabilities!) are actually recorded in the annual report.

One can understand the business better just from reading the annual report. For instance, I understand now how low margin a property development company is, and most of them should at least have another branch of income available.

I highly recommend this course for the instructor is extremely experienced and intrinsically passionate in teaching his self-developed materials. However you will need to have a rudimentary understanding of the financial statements in the first place, in order to fully adsorb majority of the materials. Annual reports are a toughie-- it will pay for you to study some AR before going for this course.