- File Size: 11631 KB
- Print Length: 220 pages
- Publisher: Wendl Financial, Inc.; 1 edition (February 25, 2013)
- Publication Date: February 25, 2013
- Sold by: Amazon.com Services LLC
- Language: English
- ASIN: B00BNFJXI6
- Text-to-Speech: Enabled
- Word Wise: Enabled
- Lending: Not Enabled
- Amazon Best Sellers Rank: #413,161 Paid in Kindle Store (See Top 100 Paid in Kindle Store)
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The Net Current Asset Value Approach To Stock Investing Kindle Edition
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The book starts off by giving a good introduction to the NCAV strategy, and slowly but surely drifts towards providing empirical evidence on the NCAV strategy's triumph over other stock selection strategies, primarily the well-known indices.
My gripe is that though the empirical evidence provides the reader with the confidence to try out the methodology, I did not expect a good portion of the book to focus on it. To be fair, the author combines NCAV strategy with other screening methods like low P/E, dividend yield etc., and analyzes their performance vis-a-vis a pure NCAV strategy. This highlights improvements one could make to their NCAV strategy.
What the book was missing - and this is pretty important - is the discussion on the accompanying quirks and traits of the NCAV businesses and how to go about separating the potential winners from the rest. I follow a few net-net investors and they endorse analyzing the qualitative (and quantitative) aspects of the NCAV candidates before pulling the trigger.
Though the book is a good introduction to net-net investing, I was left wanting more. I recommend another book 'Deep Value Investing', wherein the author provides for a good number of case studies on his net-net investment experience.
The book started strongly by introducing NCAV and its calculation of the equation parts.
Chapter 3 onwards started to sound more like an academic study.
The most important chapter is the last and the one to look out for (in fact, print out and frame at your desk) is on page 180 - 182. They comprised of the 10 rules for using NCAV approach to stock selection.
I actually felt that my money (look, this book is really much cheaper than the usual investing book) was not well spent till I came to that chapter. I also found more useful reads through its Bibliography list.
My main issue with the book was not the contents itself, but the book's failure to close the expectation gap created between the reader - who really wanted to learn how to apply the NCAV approach and hear about specific case studies where it had worked, and the author Mr Wendl - who appeared only interested to proof that NCAV still works well in modern times.
Or maybe Mr Wendl understood that NCAV approach comes with a huge psychological burden (buying out of favour stocks), and his focus was to use emphirical results to convince any keen adopters of this technique that it is a time-tested strategy.
For me, I was looking for a book that can teach me how to apply NCAV investing and walk me through cases. Deep Value Investing by Jeroen Bos is a better read for me.
This book provides an approach to investing (net current asset investing) and importantly provides substantial evidence to prove the success of the strategy. It is clear the author has put in a ton of time to look at the historical performance of these stocks. In doing so, he makes a compelling case for investing in stocks that meet his criteria. In summary, the author educates the reader about one type of investing and provides the statistical evidence to show that over long periods of time this strategy has outperformed the general markets by a meaningful amount. For deep value investors or those interested in reading and learning more about one type of deep value investment strategy, I highly recommend. If you are interested in a romantic novel, this might not be the book for you. :)
Top international reviews
What I missed was a more detailed look at sub-strategies (he does invest low PE and dividend yielding NCAV stocks) as well as a heavier emphasis on investor psychology. The book is also very light on detail.
Overall a decent read for a newcomer to the NCAV approach, but don't expect too much. If you're not familiar with NCAV investing, I'd recommend it, otherwise there's not much new under the sun.