So since you are at the investingbythebooks site, I guess you have read a few books. But besides reading books ... What else can you do to become a better investor, and not to read another book about value investing?
Lets compare with something else, for example football. “A huge football fan that knows every tiny detail about the game. He knows exactly what is going on, what the players are doing right, what they are doing wrong. But if you put him on the field, he can't throw the ball because he never did it in his life before.” It is one thing to know what you need to do, but it is another to execute. Only way to learn how to execute is to actually play the game, or in this case, actually invest your own money”
Below is a text who is heavily inspired from Geoff Gannon, original here, https://www.gurufocus.com/news/144029/invest-with-style
1) Have Skin in the Game
Buy stocks you pick yourself. Stocks you can only blame yourself for if they lose you money. The hard work isn’t just analyzing a company and handicapping the situation. It’s putting your own money — and your own ego — on the line.
2) You have to have skin in the game.
You have to risk taking a self-inflicted blow to your money and your mind. The most important part of investing is trying, failing, experimenting, and adapting on your own. Watch yourself work under real world stress. And be brutally honest about what you see.
3) Keep an Investment Diary
Take some time every day or at the least once a week and just write down whatever thoughts you have. Stocks you are looking at. Months from now and years from now, your memory of what you were feeling and what you read in that journal won't match. And you may not recognize the person who wrote those things. You'll have changed as an investor without realizing it.
4) Keep an Investment Bucket List
If you had to put your family’s money into five stocks before you died, which five stocks would they be? Study companies regardless of their stock price. Keep a list of your favorite companies. Imagine the following limitations:
· You have to invest all of your family's net worth in stocks.
· You can never sell a stock once you buy it.
· You can only buy five stocks between now and the day you die.
It’s amazing how quickly this exercise will force you to distill your thinking.
5) Work more
When authors list Warren Buffett's investing secrets they don't mention that he read every book on investing in the Omaha public library by the age of 11. That he owned stocks in high school. That he took a train down to Washington and knocked on GEICO's door. That he went to annual meetings of companies he knew Graham owned stock in even though he was only a student and Graham himself wasn’t going. Which brings me to the Buffett did that you can do too: 1. Work an absurd amount. 2. Become an expert .
6) Become an expert
Become an expert. You've studied some different stocks now. You've had a taste of Indian stocks, U.S. stocks, Japanese stocks, micro caps, big caps, net-nets, hidden champions, etc. What interested you? What stock was the most fun to research? What did you think you really "got"? Think about what area you might want to learn more about. Then become an expert in that area. Pretty soon, you'll develop your own investing style.
7) Invest with Style
Do you buy turnarounds? Hidden champions? Wide moats? Brands? Companies with surplus cash? Family controlled companies? Food and beverage companies? Companies with mind share? With cutting edge tech? With a lack of change? Young companies? Old companies? Low cost operators? Stocks in industries with little price competition? Stocks with an activist banging at the gates?
8) One example – of someone with an investment style…
One example of investment style”, watch an interview — any interview — with Tom Russo, for example he gave three lectures at Columbia. He is a buy and hold investor. He is a global investor. He likes brands. He likes food and beverage companies. And he likes family controlled companies. He wants a high return on capital and the ability to reinvest that capital for many, many years to come. He cares about price. But he’s a lot more flexible on price than most value investors. Just Google him.
To summarize, grow your own style, and play some football!