88 The Business of Value Investingbusiness competitor within the same industry. Read up on industry
data so you understand the underlying dynamics going on within
the business. It ’ s true that value investors ignore the macro picture
and focus on the underlying business. But there ’ s a big difference
between ignoring something and being ignorant of the facts. In fact,
astute investors are very well aware of the macroeconomy. For exam-
ple, you might discover a wonderful oil company that looks cheap
but realize that with oil trading at $ 150 a barrel, most of the future
value comes from oil prices remaining at those levels. By under-
standing industry fundamentals, you will avoid such elementary mis-
takes. Instead, you want a business that is still growing when oil is at
$ 60 a barrel and everything in between. Or you may decide to wait it
out until a temporary setback brings oil prices down and place your
bet then. The point is that by arming yourself with more and more
information, you are less likely to make mistakes of commission.
If you ’ re serious about business and investing, these publications,
listed in no order of importance, should be mandatory reading:- Financial Times
- Wall Street Journal
- Intelligent Investor by Benjamin Graham
- Security Analysis by Benjamin Graham
- The Economist (excellent global journalism)
- Fortune (excellent business journalism)
- The Value Line Investment Survey
- Berkshire Hathaway Annual Letters
- Barron ’ s
Suggested readings include:- Outstanding Investor Digest
- New York Times
- The Shanghai Daily
• This book... ;)
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