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Outsmarting the Crowd: A Value Investor's Guide to Starting, Building, and Keeping a Family Fortune
WE ARE WIRED TO FAIL WITH MONEY AND INVESTING.
Do You Have $1 on You? BEFORE YOU START READING, please reach for your wallet. Take out a one-dollar bill. Do you have it? Look at it, hold it up, put it in front of you.
Now imagine you save $1 each month (which few do). Imagine that your $1 earns 7% annually on average over thirty years. At the end of the thirty years you will have almost $1,200.
Needless to say, if you put away $1,000 each month, you'd have almost $1.2 million in thirty years.
It's secondary if you are just starting your family fortune--or if you already have it and want to keep it and grow it.
If you do nothing with that dollar, inflation will eat away at its value. It will be worth less than two quarters in twenty-five years and less than a single quarter in fifty years and a nickel in one hundred years.
Can you afford to do nothing? Do I have your attention?
Most books misinform, or intimidate the reader, and often are not backed by real life experience.
This book is a one of a kind, comprehensive, straightforward, and easy to follow guide to investing. It’s written by an experienced investor trained in the value investing, Buffett-Graham school of thought.
Like no other book, it covers both the intellectual and emotional discipline needed to be a successful investor. It provides the proper philosophy, shows the path, and emphasizes the principles required to keep and grow your wealth over a lifetime.
“Over more than a decade, Bogumil has assiduously assembled a set of rules from the writings and the speeches of the world’s most lastingly successful investors: these rules have become his chosen investment discipline. […] He has written a great road map for young investors as well as a thoughtful and very readable guide to spare older neophytes the most common investment mistakes.” — François D. Sicart, Founder and Chairman of Tocqueville Asset Management.
Do You Have $1 on You? BEFORE YOU START READING, please reach for your wallet. Take out a one-dollar bill. Do you have it? Look at it, hold it up, put it in front of you.
Now imagine you save $1 each month (which few do). Imagine that your $1 earns 7% annually on average over thirty years. At the end of the thirty years you will have almost $1,200.
Needless to say, if you put away $1,000 each month, you'd have almost $1.2 million in thirty years.
It's secondary if you are just starting your family fortune--or if you already have it and want to keep it and grow it.
If you do nothing with that dollar, inflation will eat away at its value. It will be worth less than two quarters in twenty-five years and less than a single quarter in fifty years and a nickel in one hundred years.
Can you afford to do nothing? Do I have your attention?
Most books misinform, or intimidate the reader, and often are not backed by real life experience.
This book is a one of a kind, comprehensive, straightforward, and easy to follow guide to investing. It’s written by an experienced investor trained in the value investing, Buffett-Graham school of thought.
Like no other book, it covers both the intellectual and emotional discipline needed to be a successful investor. It provides the proper philosophy, shows the path, and emphasizes the principles required to keep and grow your wealth over a lifetime.
“Over more than a decade, Bogumil has assiduously assembled a set of rules from the writings and the speeches of the world’s most lastingly successful investors: these rules have become his chosen investment discipline. […] He has written a great road map for young investors as well as a thoughtful and very readable guide to spare older neophytes the most common investment mistakes.” — François D. Sicart, Founder and Chairman of Tocqueville Asset Management.
226 pages, Kindle Edition
Published December 12, 2015
17 people are currently reading
128 people want to read
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Displaying 1 - 10 of 10 reviews
July 3, 2017
Things I learned:
Stock market is not a way to get rich overnight. Investing is about patience, discipline and rationality. By planning strategically and sticking with your investments.
Buy low, sell high us the buzzword of investing. Be picky and never gamble with your money.
To own stock is to own part of a business in exchange for funding its operations. Stock represents part of a business.
Entrepreneurs can own a business outright or split ownership with other partners, as a stockholder, you can own shares of a company.
Entrepreneurs and partners work day in, day out to manage their business, as a shareholder you don’t have any responsibility for managing the company and can sell your shares whenever you want.
Shareholders own stock as long as they want until they sell it to other investors, hopefully turning a profit and sometimes collecting dividends in the process.
Investing is about rationality and the right timing, so keep your emotions out of it.
It’s essential to know when to disagree with the masses and buy when everyone is selling or sell when everyone is buying.
Good timing usually presents itself when extreme emotions are driving financial markets.
The time to buy is when there's blood in the streets.
Successful investing is about discipline, patience and only using money you don’t need to spend.
Know your areas of expertise and deepen your knowledge continually.
Knowing when to break from the crowd is essential to good investing.
Outsmart other investors by building up your knowledge every day.
Good investment decisions depend on simplicity and selectivity.
Stick with the indicators that matter most to you and forget about the rest of them.
Apply four filters:
1.do you understand the business? You shouldn’t invest in a company selling a new technology you don’t know anything about just because it seems innovative.
2.does the company have long-term potential? Some industries are fads and others, like food or health care, are more essential.
3.do you trust the management? This one is simple because a CEO that previously bankrupted several companies is a red flag.
4.is the price right? In other words, if you think the stock is overpriced, move on and look for another opportunity.
Carefully choose stocks in competitive companies that anticipate change.
Seek out companies with a genuine competitive advantage, one or more attributes that help them outperform competitors.
One such attribute is pricing power, a company’s ability to easily raise prices while retaining its customers.
Stay clear of companies that can’t anticipate change.
Markets can plummet and soar on a dime so your best bet is to stay in for the long haul.
Smart investors put security first, so buy cheap, lower your expectations and diversify your stocks.
Investing seem it's about making more money, but the truth is, good investors make it their priority not to lose money.
Buying cheap is key, but it’s important to remain conservative with your expectations. You can’t predict the future and shouldn’t bother trying.
Stock market is not a way to get rich overnight. Investing is about patience, discipline and rationality. By planning strategically and sticking with your investments.
Buy low, sell high us the buzzword of investing. Be picky and never gamble with your money.
To own stock is to own part of a business in exchange for funding its operations. Stock represents part of a business.
Entrepreneurs can own a business outright or split ownership with other partners, as a stockholder, you can own shares of a company.
Entrepreneurs and partners work day in, day out to manage their business, as a shareholder you don’t have any responsibility for managing the company and can sell your shares whenever you want.
Shareholders own stock as long as they want until they sell it to other investors, hopefully turning a profit and sometimes collecting dividends in the process.
Investing is about rationality and the right timing, so keep your emotions out of it.
It’s essential to know when to disagree with the masses and buy when everyone is selling or sell when everyone is buying.
Good timing usually presents itself when extreme emotions are driving financial markets.
The time to buy is when there's blood in the streets.
Successful investing is about discipline, patience and only using money you don’t need to spend.
Know your areas of expertise and deepen your knowledge continually.
Knowing when to break from the crowd is essential to good investing.
Outsmart other investors by building up your knowledge every day.
Good investment decisions depend on simplicity and selectivity.
Stick with the indicators that matter most to you and forget about the rest of them.
Apply four filters:
1.do you understand the business? You shouldn’t invest in a company selling a new technology you don’t know anything about just because it seems innovative.
2.does the company have long-term potential? Some industries are fads and others, like food or health care, are more essential.
3.do you trust the management? This one is simple because a CEO that previously bankrupted several companies is a red flag.
4.is the price right? In other words, if you think the stock is overpriced, move on and look for another opportunity.
Carefully choose stocks in competitive companies that anticipate change.
Seek out companies with a genuine competitive advantage, one or more attributes that help them outperform competitors.
One such attribute is pricing power, a company’s ability to easily raise prices while retaining its customers.
Stay clear of companies that can’t anticipate change.
Markets can plummet and soar on a dime so your best bet is to stay in for the long haul.
Smart investors put security first, so buy cheap, lower your expectations and diversify your stocks.
Investing seem it's about making more money, but the truth is, good investors make it their priority not to lose money.
Buying cheap is key, but it’s important to remain conservative with your expectations. You can’t predict the future and shouldn’t bother trying.
July 15, 2017
If Benjamin Graham were to create a workbook for his book, The Intelligent Investor, then this may have been what he would have in mind. There are many practical exercises and tips for the average investor in this book. Though it reads like PowerPoint presentation, the author uses this organizational style to present the content in a well thought-out and usable manner.
December 24, 2015
I was completely blind about stocks and investing. This is an amazing book to help you start making money with stocks. It gives you a diferent perspective that you may not have known about before. If you want to start investing or if you have been investing for years, READ this!!!!!
December 10, 2018
DOUBT THE WISDOM OF OTHERS IN YOUR SEARCH FOR IDEAS.
In today's world its getting harder and harder to be patient. We are getting spoiled by the speed of all the services we get these days.
The fear of making a mistake shouldn't force you into inaction. It should inspire you to try again, differently, while minimising the impact of each of those mistakes.
Investing is a fulfilling pursuit but its meant to be challenging. You need to be comfortable with not being always right.
A minimalist investors path leaves more room for learning, growing and eveloping both pateince and immunity to all the noise.
I like to invest in weel established companies in the mid-to-late part of their life. They can still have nice growth ahead of them. That is a beautiful time for a company. The problem is that its harder to find true bargains at this sttage of their life cycle.
The underlying qualities of the beginning of a bear market are usually overexpanded credit, low interest rates and high multiples of the general market.
In today's world its getting harder and harder to be patient. We are getting spoiled by the speed of all the services we get these days.
The fear of making a mistake shouldn't force you into inaction. It should inspire you to try again, differently, while minimising the impact of each of those mistakes.
Investing is a fulfilling pursuit but its meant to be challenging. You need to be comfortable with not being always right.
A minimalist investors path leaves more room for learning, growing and eveloping both pateince and immunity to all the noise.
I like to invest in weel established companies in the mid-to-late part of their life. They can still have nice growth ahead of them. That is a beautiful time for a company. The problem is that its harder to find true bargains at this sttage of their life cycle.
The underlying qualities of the beginning of a bear market are usually overexpanded credit, low interest rates and high multiples of the general market.
August 18, 2017
Outsmarting the Crowd was an average book in my opinion. I can best describe it as a cross between The Millionaire Teacher and Robert Hagstrom's The Warren Buffet Way. Don't get me wrong, Outsmarting the Crowd is a sound book in terms of its investing lessons, focusing heavily on two principles: 1) saving...saving...saving early and regularly in order to build an investment account; 2) investing on a low cost, value basis using the basic principles of Warren Buffet and Charlie Munger. However, the book just could not hold my interest for some reason....I suspect the writing style. In contrast, I was captivated by the two books I mentioned earlier in this review. I can recommend a better path: read The Millionaire Teacher and The Warren Buffet Way back-to-back. You'll learn more and enjoy more. So I can only give Outsmarting the Crowd an average rating despite its solid advice and lessons.
September 27, 2019
Good for beginners. Easy to comprehend. I liked the analogy with stocks compared to students. 👍🏼
July 19, 2020
A decent guide for new traders, in order to set their expectations right and to avoid losing money.
March 20, 2023
Do you need a book to tell you to not panic and buy the dip?
May 21, 2021
If you’re new to investing, you might think that the stock market is a way to get rich overnight. But the truth is that investing is about patience, discipline and rationality. By planning strategically and sticking with your investments, you can build up the portfolio and the wealth you’ve always dreamed of.
Investing is about rationality and the right timing, so keep your emotions out of it.
Successful investing is about discipline, patience and only using money you don’t need to spend.
discipline can be tricky. Part of it is about letting go of the fear that you’re missing out on an investment opportunity.
discipline also means not gambling with money you might need. Fear, which can drive people to make irrational choices, is the investor’s worst enemy. But it can be difficult to keep your fear from getting the best of you if you invest money you need to pay your mortgage.
So avoid making bad choices based on irrational fears and only invest money you know you won’t need for the next three to five years. Keep the rest safely planted in your savings account.
Know your areas of expertise and deepen your knowledge continually.
Warren Buffett, one of the most successful investors on Wall Street, often cites the concept of a circle of competence. The idea is that it pays to know what you’re good at and to stick to it.
reading regularly is imperative to succeeding as an investor.
Sound investment decisions depend on simplicity and selectivity.
It might seem ingenious to come up with a complex investment strategy, but the truth is, real wisdom is about keeping things as simple as possible. So just focus on what really matters. To stay focused, stick to the Pareto Principle
In short, you need to apply filters. When Warren Buffet considers an investment he uses the following four:
1, do you understand the business?
2, does the company have long-term potential?
3, do you trust the management?
4, Is the price right? is it overpriced?
Carefully choose stocks in competitive companies that anticipate change.
Smart investors put security first – so buy cheap, lower your expectations and diversify your stocks.
Investing is about rationality and the right timing, so keep your emotions out of it.
Successful investing is about discipline, patience and only using money you don’t need to spend.
discipline can be tricky. Part of it is about letting go of the fear that you’re missing out on an investment opportunity.
discipline also means not gambling with money you might need. Fear, which can drive people to make irrational choices, is the investor’s worst enemy. But it can be difficult to keep your fear from getting the best of you if you invest money you need to pay your mortgage.
So avoid making bad choices based on irrational fears and only invest money you know you won’t need for the next three to five years. Keep the rest safely planted in your savings account.
Know your areas of expertise and deepen your knowledge continually.
Warren Buffett, one of the most successful investors on Wall Street, often cites the concept of a circle of competence. The idea is that it pays to know what you’re good at and to stick to it.
reading regularly is imperative to succeeding as an investor.
Sound investment decisions depend on simplicity and selectivity.
It might seem ingenious to come up with a complex investment strategy, but the truth is, real wisdom is about keeping things as simple as possible. So just focus on what really matters. To stay focused, stick to the Pareto Principle
In short, you need to apply filters. When Warren Buffet considers an investment he uses the following four:
1, do you understand the business?
2, does the company have long-term potential?
3, do you trust the management?
4, Is the price right? is it overpriced?
Carefully choose stocks in competitive companies that anticipate change.
Smart investors put security first – so buy cheap, lower your expectations and diversify your stocks.
July 3, 2024
Bogumil is a high quality man. That much is obvious.
The book inspired me in a way I couldn't have predicted. It inspired me to share my own unconventional story and embrace every part of it.
Updated: 5 stars for the book. Reading this at 24 changed my life. Cheers Bogumil!
The book inspired me in a way I couldn't have predicted. It inspired me to share my own unconventional story and embrace every part of it.
Updated: 5 stars for the book. Reading this at 24 changed my life. Cheers Bogumil!
Displaying 1 - 10 of 10 reviews