Value Investing with Bill Ackman

Like a quality woman. You only want 1 that you can keep forever.

I am a trying hard to be full time stock investor with a lot of free time last night and started browsing. I thought I could read some more materials about stock investing and to get to know the gurus of today aside from Warren Buffett that invest for the long term.

And while I was surfing the net, I came across a floating university and enrolled myself to the eSeminar series on value investing for only $50. The teacher in that class is Bill Ackman.

By far, the best explanation I have experienced for value investing. He makes value investing so much easy. And I think I have a man crush on the guy. I did a search on him and he's the real deal. For 7 years, his fund returned 22% annually. Beating Buffett and anyone at the moment.

What I also like about this investor is he is an activist and like any other value investors, invests in at most 10 companies at a time. He's an activist investor, he takes over a flailing company to influence it like a corporate raider. But the difference is, the corporate raider sells what's left. Ackman on the other hand, tries to turn the business around to profit. And gets out of the company when it can stand on its own. You've gotta love this person's work.

He suggests 9 investment criteria in looking for a stock. They are:


1. Invest in public companies.

2. Understand how the company makes money.

3. Invest at a reasonable price.

4. Invest in a company that could last forever.

5. Find a company with limited debt.

6. Look for high barriers to entry.

7. Invest in a company immune to extrinsic factors.

8. Invest in a company with low reinvestment costs.

9. Avoid businesses with controlling shareholders.

One particular criteria that stood out for was #4 Invest in a company that could last forever. I remember Warren Buffett also said the same thing. "Invest in a company in which even if the stock market is to be closed for 20 years, you'll be happy owning the stock". Its investing in companies that you can hold for the long term or even forever.

Much like a quality woman.