Contents ixChapter 6 Effective Business Valuation
The Third Element 91
Value Investing 101: Margin of Safety 92
Value Investing 201: Intrinsic Value 95
Value Investing 301: Seek Businesses
with a Wide Moat 101
Value Investing 401: Calculating a
True Intrinsic Value 106
The Value of Management 111
Understanding Return on Equity:
Microsoft Corporation 121
Key Takeaways 124Chapter 7 Have the Discipline to Say No
The Fourth Element 125
In Investing, Discipline is Everything 126
Discipline Affects the Price Paid,
Which Determines the Value You Get 128
Be Prepared to Look Stupid 132
Don’t Split Hairs 137
Unveiling Investor A: Warren Buffett 139
Discipline Is Simple but Rarely Easy 145
Key Takeaways 146Chapter 8 Practicing the Art of Patience
The Fifth Element 147
Swimming against the Current 150
The Benefits of Waiting for a Good Pitch 151ftoc.indd ixftoc.indd ix 9/2/09 6:56:42 PM9/2/09 6:56:42 PM