Value Investing: A Value Investor's Journey Through The .

Transcription

Value Investing:A Value Investor’s JourneyThrough the Unknown By J. Lukas RiseInvestor.com

Copyright 2015 EndlessRise InvestorPermission to reproduce ortransmit in any form or byany means – electronic ormechanical,includingphotocopying and recording –or by an information storageand retrieval system, must beobtained by contacting theauthorsviae-mailatsupport@EndlessRiseFinancial

Ordering InformationFor additional copies irst EditionFirst printing: March 2015Neither the author nor thepublisherassumesany

responsibility or liabilitywhatsoever on the behalf ofthe purchaser or reader ofthese materials.Anyperceived slight of anyindividual or organization ispurely unintentional. Whileall attempts have been madeto verify the informationprovided in the publication,neither the author nor thepublisherassumesanyresponsibility for any errors,

omissions,orcontraryinterpretations of the subjectmatter herein.This book is for informationalpurposes only. It should notbe construed as financialadvice of any kind. We areall free to make our owndecisions when it comes tofinancialandinvestingmatters.Weareallresponsible for your own

actions.

Your Free GiftAs a way of sayingthanks for your purchase, I’moffering a free investingmindmap and blueprint that’sexclusive to my readers.Making money investingin the stock market offers arareopportunityfor

ANYONE to generate andgrow wealth into the future.But in order to reap thebenefits of investing itrequires the right type ofmindset and processes. That’swhy I created the UltimateInvestor Blueprint.This Blueprint includesthe 5M Mental Model(detailed in this book),advanced video tutorial, a

Mindmap of the process, aswell as checklists, and muchmore.Itencompasseseverything an investor wouldneed on their journey toinvesting success, or. You can downloadthis free blueprint by goinghere.

https://uibfreegift.endlessrisein

See A lot You See Little,

See Little You See A Lot!

ContentsFAQ – DOUBTERS READTHIS7 Reasons Why YouNeed To Read This Book5 Rules To Use ThisBook & Getting To 5 MillionStandingOnTheShoulders Of GiantsFrom Wall Street To TheHuman Condition: The 80/20

PrincipleMy StoryTHE5M MENTALMODELWHAT IS THE 5M MENTAL MODELMARKETMASTERYDO YOU KNOWYOUR COMPETITION?

Know Your CompetitionIsItImportant AndKnowable?A Complex Adaptive SystemInvesting Or SpeculatingWhere To Find OpportunitiesMINDSETMASTERYDO YOU HAVETHEPROPERBEHAVORAL TOOLKIT?

Getting Into A State Of FlowInvesting As A LeisureActivityApproach Investing Like A“Real” Business PersonCommitment&Perserverence To SucceedLong-TermA Prosperity Mindset

MORALSMASTERYDO YOU HAVETHERIGHTPHILOSOPHY?Always Think About RiskBefore ReturnA Contrarian StreakStick With A Long-TermApproach To Investing“Few, Big And Infrequent

Bets”Agnositc OfEnvironmentTheMacroMECOM METHODMASTERYDO YOU HAVETHEPROPERANALYTICALFRAMEWORK?

The MECOM MethodStep #1: MoatsStep #2: EarningsStep #3: CatalystsStep #4: ObligationsStep #5: ManagementMARGINOFSAFETYMASTERYISTHEREADIVERGENCE BETWEENPERCEPTION & REALITY?

The Art Of ValuationUsing A Range Of ValuesFor Intrinsic ValueDiscountedCashFlowValuation (DCF)Liquidation Valuation (LV)PUTTINGTOGETHERITWHAT’S NEXTALL

AcknowledgmentsResourcesandReadingFurther

FAQ – DOUBTERS READTHISIs investing right foryou? Chances are good that itis. Here are some of the themost common doubts andfears that people have beforetaking the leap and joiningthe Endless Rise Investors:

Do I have to be a risktaker? Do I have to taketime out of my day?Erroneous on all counts. Ialways wanted to say that.From developing theproper mindset like the superinvestors of our time to easilyvaluingalltypesofbusinesses. How does aperson spend just 60 minutesper month on their investing,yet still produce out-sized

investment returns? How toknow what kind of businessesto invest in and whichbusinesses to avoid to protectyour wealth? It's all here.I feel like my time haspassed. Do I need to be inmy twenties and single toget involved in investingnow?Not at all. This book isfor anyone who is sick of

deferring money makingdecisionstoso-called"professionals" and givingtheir hard earned money tomanagers that make moneywhether you realize returns ornot. If you're sick of thestandard menu of options andprepared to enter a world ofinfiniteoptionsandopportunity, this book is foryou

I just want more time. Do Ihave to spend hours doingthis?No. It's an option.However, the objective of the5M Mental Model is tocreate freedom of time byarming you with an easy tofollow mental model focusedon the most important factorsto investment success. Onceyou have a grasp of the 5M Mental Model you will be

able to determine high qualityinvestmentopportunitieseasily and efficiently.I don't have much money.Do I need to be born rich?Absolutely not. Althoughmy parents worked very hard,I was never born into a life ofluxury; I'm no Vanderbilt orRockefeller or Walton, andyou needn't be either.

Do I need to be an IvyLeague or business schoolgraduate?Not one bit. Many of theworld’s top investors didn'tgo to the Yale's of the world(although there’s nothingwrong with the Yale’s of theworld). There are too manyunrecognized benefits to notcoming out of one. Topacademic institutions aregreat. I believe they do more

good than bad, however manyof these students are funneledinto these high-stress, highincome, 80 hour week jobs.For many of them, that's 2030 years of soul-crushing,unfulfilling work that theybelieve is the only path.How do I know? I'veseen it first hand. And I'veseen the destruction it cancause to a person and thefinancial system as a whole.

This book helps to reversethat.5M Mental Model andMECOM Method itsounds a little cheesy andgimmicky ?Ha. I thought the samething.Increatingaphilosophy and method forinvesting success, I wanted tocreate something that wouldstick in the minds of the

readers. Something that youwould be able to recall at amoment’snoticewhileinvesting.5M andMECOM are essentiallymnemonic triggers to do justthat.They’re worded this wayto help you navigate to the farreaches of your brain to helpyou pinpoint the mostimportantelementsforinvesting success. When I

invest now, it’s all I use. I amalways thinking in MECOMnow. If it can’t pass the basicelements of MECOM, I throwit in the trash and move on toanother potential opportunity.It’s all about using timeefficiently and effectively.The cornerstone of greatinvesting is already here -- It'sjust unevenly distributed.Most people just don't knowabout it yet

7 Reasons To Read ThisBook, Even If You HateInvesting (As I Did)AValueInvestor’sJourneyThroughTheUnknown isn't just aninvesting book, per se, thoughon the outside it may looklike one. Just as PoorCharlie's Almanac isn't justabout investing, this bookisn't quite what it appears (I

wish I was as cool as CharlieMunger).Even if you hateinvesting, here are the sevenreasons you should read atleast the first few chapters ofthis book:#1You'll Learn How ToBecome World Class InRecord Time.Whether you want to

learn how to create a portfolioof high quality businesses,how to "think" about thestock market, or how to easilyvalue businesses in less than aminute -- the true "goal" ofthis book is to provide exactlythat: a process for investingsuccess. The vehicle I choseis the 5M Mental Model.Throughout this book, I'llteach you all of the mostefficientandimportant

techniques and checklists thatmattermosttoyourinvestment success. Eachsection will take a minimalamount of time, but result inyou having The UltimateInvestor Blueprint. My hopeis for book to make you amaster student at investing.#2You Will Get In The BestMental Shape Of Your Life.

The mental models you'lllearn, apart from businessanalysisandvaluationtechniques, are all compliantwith "value investing." If youfollow this book, you won'thave to think about being lostas you make investmentdecisions, since this mentalmodelisbuiltusingmnemonic triggers to helpyou remember the elementsthat matter most to investing

success. If you ever decide tofollow another investmentprocess or system, you'll betwice as effective, becauseyou'llunderstandhoweverything is interconnectedfrom the various mentalmodels you will learn in thisbook.#3Investing (And Life) WillBecome Brighter.

I pose a question to you:have you really learned howto invest? Even while writingthis book, I now realized thatI hadn't. Back then, investingwas part of my job. It'ssomething I did, either goodor bad, efficient or not. Now,I truly have a system andprocess for success. And theprocesses and mental modelsin this book go way beyondinvesting. It's like going from

black and white TV to color.As you'll see, the mentalmodels built into 5M willaffect everything you do. Lifeitself becomes much betterwhen you are equipped withworldly mental models.#4Investing Is The ConfidenceAdvantage.Being a great investor orcapital allocator, or even

articulating investment ideasbetter from the mental modelsin this book, can be a forcemultiplier in your confidencelevels and understanding ofinvesting.Increasedconfidence with the ability tosupport your significant otheror family members issomething I can't explain withwords. It makes you feellarger than life. You walk in aroom and people can notice

the confidence.#5It Doesn't Take Much ToBecome Impressive.In the first 24 hours, I'lltake you from being all overthe place in your investmentprocess to helping youpinpoint the things that mattermost to investing success.Withmoreandmoreinvestors giving up on the

stock market all together, orherding around the samestocks, it gives you a #6The Markets Aren't Rigged-- They're Beatable!It took me years todiscover just how profitablevalue investing really is. The

reason for this book is tomake sure others don't makethe same mistake.Make this book a keypart of your investmentstrategy to earn valueinvesting returns over thelong-term. The money youcould make off of even justone great idea will pay forthis book many times over.#7

Because It's Fun AndLucrative At The SameTime.Knowing that you have asystem that can lead you intherightdirectiontoinvesting success can be anextremelyfulfillingandlucrative endeavor that willstay with you for a lifetime.And intermittently, I willkeep you entertained andamused with some stories of

successes and failures alongthe way. Investing mentalmodels and analysis? Check.Funnyandridiculousinvesting anecdotes? Gotthosetoo!Afterall,sometimes we learn morefrom our mistakes than oursuccess. Hopefully you canlearn from mine and others.This is the furthest thingfrom a textbook. See the nextsection on how to use this

book.

How To Use This Book: 5Rules And Getting To 5Million PeopleIt's crucial that you followthese rules at all cost. I willnot be held responsible if youdon't.RULE #1. Think of ThisBook As A Buffet (no.not

Buffett).DO NOT read this bookfrom beginning to end. Justdon't do it.Let's be honest --- Mostpeople won't even need morethan 100 pages to gainincredibleinsightintosomething they were missingabout investing. Check thetable of contents, go to thechapters that are mostintriguing to you, and just

discard the rest.until youneed it.Mandatorysectionsdepend on where you are asan investor. If you are acomplete newbie, the Marketand Mindset section may helpyou the most initially. Ifyou've dabbled in the stockmarket or have a 401(k), thenthe MECOM Method andMargin of Safety sectionsmay appeal to you most. If

youareaseasonedprofessional, the mentalmodelsandphilosophysections may tickle yourfancy. Here are some populargoals, along with thecorresponding sections:MarketMastery(understanding of the stockmarket)Know Your CompetitionIs It Important And

KnowableA Complex AdaptiveSystemInvesting or SpeculatingWheretoFindOpportunitiesTotal page count: 18pagesMindsetMastery(psychology)Getting Into A State ofFlow

Investing As A LeisureActivityApproach Investing As A“Real” Business PersonCommitment&Perserverence To SucceedLong-TermA Prosperity MindsetTotal page count: 28pagesMorals(philosophies)Mastery

Always Think About RiskBefore ReturnA Contrarian StreakStick With A Long-TermApproach To Investing“Few, Big And InfrequentBets”Agnostic of The MacroEnvironmentTotal page count: 22MECOM MethodMastery (business analysis)

The MECOM MethodStep #1: MoatsStep #2: EarningsStep #3: CatalystsStep #4: ObligationsStep #5: ManagementTotal page count: 149Margin of Safety Mastery(valuation)The Art of ValuationUsing A Range of Valuesfor Intrinsic Value

Discounted Cash FlowValuation (DCF)Liquidation Value (LV)Total page count: 63RULE#2.BESKEPTICAL.Don't let me off the hookthat easily. Seriously, I'm notkidding. If you believe someof these tips, tricks orconcepts aren't correct, thenlets start a conversation about

it. Not only will I find it fun - it will make me a betterperson and investor bylooking at things from allkinds of different angles andviewpoints.Never assume somethingis absolute because someoneelse said it -- Always trust butverify.“True wisdom is knowningwhat you don’t know.”

ConfuciusRULE #3. DON'T LETSKEPTICISM BE THEEXCUSE FOR INACTION.It's important to alwaystry to disprove processes andideas, regardless of how saneor rational they appear at thatmoment in time. Skepticismis a worthwhile task in thepursuitofworldlyknowledge.

As Munger says, "it's ayear wasted if you don'tdisprove one of your ideas."Let me know if you haveadditional elements to add tothe system or prove mewrong.Throughyourfeedback and help, thissystem and book willcontinue to evolve over time.RULE #4.MATH IFSKIPIT'STHETOO

DENSE.You do not need to be amathematician to read thi

Investing (As I Did) A Value Investor’s Journey Through The Unknown isn't just an investing book, per se, though on the outside it may look like one. Just as Poor Charlie's Almanac isn't just about investing, this book isn't quite what it appears (I