
How to Value Shares and Outperform the Market
Synopsis
The simplest way to make money in the stock market is to buy shares when they are cheap and make profits when their prices increase. This technique is known as value investing and is the creed of the world's most successful investor, Warren Buffett. But how do you know when a share price is cheap?
This book explains in simple terms how you can develop your own UK share and FTSE100 valuation spreadsheets to calculate share and market valuations. Comparing the valuations to current market prices reveals when shares are underpriced and produces calibrated buy and sell signals. The FTSE100 system, for example, indicates the periods when you should be invested in the FTSE100 and the periods when you should not be. Since 1984 the in-periods have produced 94 times more capital growth than the out-periods.
The new valuation system is the heart of this complete practical guide for managing your own investments. It shows how you should be able to double the value of your long-term investments purely through avoiding high commercial fund management fees. Using the new valuation system should help you do a lot better than this and, for example, secure a pension up to eight times larger than that provided by commercial managers.
As well as providing comprehensive information about the practical and profitable ways in which you can use the new valuation system, this book is a complete toolkit for creating personal wealth through UK equity investment. It includes risk controls, tax breaks, free information sources and recommendations on the best service providers. In short this book is your first step along the road to financial security.
Details
Reviews
This is an excellent - and very readable - guide to the principles and practice of valuing shares from an expert with a first-rate record of identifying stock-market opportunities. A must-read for both aspiring and established value investors.Dominic Picarda, Associate Editor, Investors Chronicle
A raft of useful advice...a useful aid to investors of all levels of expertise. Not many books aimed at the private investor actually explain how to create and apply valuation models in such a simple manner, so for that reason alone the book is well worth a read.Spreadbet magazine