Key Outcome of the Paper Common Errors in DCF Models by Michael Mauboussin. (Emphasis Ours) First principles tell us the right way to value a business is to estimate the present value of the future cash flows. While most Wall Street professionals learned about discounted cash flow (DCF) models in s

Please find below our key excerpts from a investor memo published by Solidarity Investment managers around January 2021. This letter covers quality material on key parameters they look while investing in a company explained through live 4-5 case studies like Bharti Airtel, CAMS etc. this letter also

Please find below our key excerpts from a recent investor memo published by Congruence Advisors on how to check financial statement and management background to avoid being stuck in a business with bad corporate governance practices. 1 - Forensic analysis, channel checks, corporate governance evalu

Please find our summary of wonderful framework on how to make judgments by Michael Mauboussin. Emphasis Ours. The process of acquiring a skill requires three stages. The first one reflects the cognitive stage where you simply try to understand the activity and therefore appreciate the opportunity

Read background of Michael J. Mauboussin here Please find our summary of his paper below: (Emphasis ours) You gain more by not being stupid than you do by being smart. Smart gets neutralised by other smart people. Stupid does not. Introduction The key highlight of the introduction is that it is

This Paper runs like a movie script on how Ed Thorp was able to detect in 1991 itself that Bernie Madoff Scheme was a fraud whereas Bernie accepted this was a fraud at the end of 2008. The Paper ends with mention of other Frauds where the pattern seems common. Key Excerpts "It began on a balmy Mon

key Extracts 1. Human mind thinks analytically and while it’s highly effective in understanding businesses, it’s ineffective in understanding markets 2. Scientists at the Santa Fe Institute are now studying complex adaptive systems – those systems with many interacting parts that are continually c

Please find below our key excerpts from investor Memos Published in 2019 by one of the well respected Fund Managers in Indian Capital Market - Mr. Viraj Mehta. Dec 2019 Memo - Why taking lower conviction bets despite of low allocations did not turn out to be right approach Key Excerpts Lower convi

Please find below our key excerpts from a investor memo published by Solidarity Investment managers. In this wonderful memo through case studies they have explained the key trigger point required to select a stock in portfolio. It also includes point of view on Zomato and telecom as a sector. (Empha

Please find below our key excerpts from a investor memo published by Solidarity Investment managers on Among many things that we found brilliant in this memo - the key highlight was the "exit decision" process explained in the memo which highlighted various methods to take a "sell" decision in a sto

Please find below our key excerpts from a brilliant paper written by Michael J. Mauboussin explaining how to adjust financials to get a better understanding of businesses which do heavy intangible investment and stock based compensation. Our summary will help people who want to enter the VC space an

Read our selected excerpts from one of the best research papers on "How to manage money during bear markets & Crises" from VerdadCap (https://verdadcap.com/) Key Excerpts (Ours Emphasis) 1. Markets are the opposite. Bull markets are all bullish in their own ways. The leaders in one expansion are a

One of the finest researcher in the finance world Michael Mauboussin came out with fantastic paper on how to value the new age technology business which contains majorly intangible assets which are not being reported on the balance sheet. Read our summary of the paper below: Michael Mauboussin, t

Key excerpts "future is never certain" "when the market price of the stock or the Index is going up, it is assumed that there is no uncertainty. Conversely, when there is a bearish trend in the market, the talk of “uncertainty” crops up more" "there are simply too many variables that determine how

Please find below our key excerpts from investor Memos Published in 2020 by one of the well respected Fund Managers in Indian Capital Market - Mr. Viraj Mehta. Dec 2020 Memo - When to buy undervalued stocks if markets are completely ignoring a particular pocket Key Excerpts "Why now: This is best

Please find below our key excerpts from a investor memo published by Solidarity Investment managers. This memo focused on how to allocate capital between portfolio stocks and how to start exiting core positions once they have become big portions of portfolios. (Emphasis Ours) - “Don’t time the mark

Please find below our key excerpts from a recent investor memo published by Congruence Advisors on "is it really necessary to ONLY buy quality businesses even though they are quoting at absurd valuations". Also case studies with respect to a few businesses have been covered which Valuations you pay

Please find below our key excerpt from a brilliant paper written by Savi Jain & Amit Mantri of 2Point2 Capital on how to analyze with a forensic lens the employee benefits expense of the company. (Emphasis Ours) Pattern 1: The companies compensation structure does not match the scale/brand/Market

Read Part 1 here Mistake#4: Not imposing self-accountability. .Solution: Maintain a decision-making journal. The practice of maintaining a journal is valuable because it mitigates some common cognitive traps. The first of these is hindsight bias; the sense that you knew what was going to happen

Please read our key pointer summary on one of the most well written research paper (quantitative logic) written on valuing latest generation subscription businesses As we see the growing popularity of subscription based businesses we need a certain predictability to gauge the valuation of those bus

Key Excerpts "Are there no PSU companies that are competitive and efficiently run? And is it right to paint the entire sector with the same brush when a few of them are run inefficiently?" "let us look at the performance of PSU shares in the stock market. For the purpose of study and comparison, w