Looking for an investment in stocks of long-term value? Veteran investor Mohnish Pabrai has two recommended books.
Talk to CNBC Pro TalkPubli — Value Investor and Billionaire Disciple Warren Buffett – said “100 to 1 in the stock market“Is a” very well written “book.
Written by Thomas Phelps and first published 50 years ago, this book teaches how to increase wealth 100-fold through buy-and-hold investments.
Buy and hold Is a passive investment strategy that buys stocks and holds them for a long time, even with short-term fluctuations.
The founder of the Pabri Investment Fund, which grew from $ 100,000 in 1999 to $ 1.2 million in March this year, was discussing his playbook on what to buy and what to avoid. ..
Another book for anyone looking for a “competitive advantage or ability to make a good profit” is Christopher Mayer’s “100 bagger“-this is A company that returns $ 100 for every $ 1 invested.
Does your business have very high equity returns? Can it grow and prosper without the use of debt? … Can this business reinvest high returns and equity at a high rate?
Mohnish Pabrai
Founder of Pabri Investment Fund
He said investors should ask themselves some questions.
“Does this business have very high equity returns? Can it grow and prosper without debt? … Can this business reinvest high returns and equity at a high rate?”
How to know if a company is a “home run”
To explain his claim, Pabri gave the following example: Starbucks..
“If you open a store in the United States, it will return in two years. If you open a store in China, it will return in 12 to 15 months,” he said.
Veteran investors added that these are “astronomical rates of return on capital” and that Starbucks has the ability to “get back money very quickly.”
“Most of us don’t go around or relax around Starbucks, so our business is more efficient. We just pre-order and pick latte, and it’s even more beneficial. [for them].. “
Pabri summarized the idea of a “home run” -he said it could see a clear “10-year, 20-year, 30-year runway”.
“I’m trying to say that if you find a business that can grow without them,
Using debt, … at a price that doesn’t look expensive, you got a home run. “
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