The Business of Value Investing.pdf

80 The Business of Value Investing

peer evaluation system going on. A good place to start would be the

highest - rated ideas, but with only 500 members contributing two

ideas a year, you can easily keep up with them all.

Without question, you can fi nd some phenomenal investment

ideas on VIC. The idea write - ups can include some unique analysis

that you can ’ t fi nd anywhere else. Nearly all the investment write -

ups are owned by the writers themselves, so you get the most com-

pelling reasons why the investment should be made. And since

these are ideas are obviously biased from the writer ’ s point of view,

they can come off as quite convincing. Ultimately, it is up to you

to decide whether to pursue the investment idea; some ideas can

be so compelling that a mere due diligence of the facts and fi gures

presented is all that is needed.

However, I would urge investors to take the ideas presented on

VIC just as any other source: as fertile hunting ground for great

investments. Unlike other sources, it is quite easy to get wrapped up

in the analysis presented from the contributors; you can see the sub-

stantial work that was done to present the idea. The best write - ups

do an excellent job of demonstrating a clear understanding of the

business, its history, the industry landscape, and a sound, conserva-

tive valuation. In fact, one of my major reasons for recommending

VIC is not only because of the ideas but because of the wonderful

education you can get simply by reading the write - ups. There ’ s no

better way to learn how to value a business than to read and under-

stand how other investment minds are doing it.

Nonetheless, because the ideas on VIC are so detailed, it is easy

to substitute VIC ’ s analysis for your own. This is the last thing you

want to do. One of the central tenets of successful investing — and

a big theme in this book — is to invest in what you understand.

Regardless of how sound an investment may be, it ’ s always wise

to perform your own diligence to the point where you are confi -

dent in the analysis provided. The last thing you want to do is buy

based on someone else ’ s work, even if it ’ s Warren Buffett doing the

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