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Rule #1: The Simple Strategy for Successful Investing in Only 15 Minutes a Week! Paperback – August 28, 2007
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From Publishers Weekly
Starred Review. For amateur investors who admire the incredible returns produced by Benjamin Graham–Warren Buffett–style value investing but can't figure out how to replicate these billionaires' methods at home, Town's investment guide is manna from heaven. A former river-rafting guide, Town learned how to calculate such crucial numbers as Return on Investment Capital and Equity Growth Rate from "Wolf," a wealthy rafter whom Town saved from a rapid in 1980. Under Wolf's tutelage, Town learned how to turn $1,000 into $1 million in five years, but the selection of lucrative stocks took weeks of library research. In this engaging and accessible book, Town shows readers how to replicate that sort of exhaustive market research on the Internet—and shorten the research time to just a few hours per stock. Fans of The Intelligent Investor will recognize that Town's Rule #1 formula—"1) Find a wonderful business, 2) Know what it's worth as a business, 3) Buy it at 50 percent off, 4) Repeat until very rich"—is a variation of Benjamin Graham's investment philosophy. (Graham and Buffett are cited heavily throughout the book.) But Town's ability to break down that philosophy into a detailed, step-by-step program that can be understood by any reader with basic math skills is unique. His chummy, reassuring tone ("If you're finding yourself already a bit overwhelmed, take a deep breath") will leave readers feeling empowered and ready to manage their money themselves. (Mar. 21)
Copyright © Reed Business Information, a division of Reed Elsevier Inc. All rights reserved. --This text refers to the Audio CD edition.
“Town's investment guide is manna from heaven… engaging and accessible… Town’s ability to break down that philosophy into a detailed, step-by-step program that can be understood by any reader with basic math skills is unique… will leave readers feeling empowered and ready to manage their money themselves.” —Publishers Weekly (starred review)
“Extraordinarily readable…provides investors with surefire tools to outperform costly advisors. Follow Town’s simple, time-tested precepts, and even unsophisticated investors will leave most mutual fund managers in the dust.” —Arthur Levitt, author of Take on the Street and former Chairman of the Securities and Exchange Commission
“A really smart, homework-driven read that tells you precisely how to do it. Rule #1 may be the clearest and best book out there to get you on the path to riches. This one’s special!” —James J. Cramer, host of CNBC’s “Mad Money” and Markets Commentator, thestreet.com
“Rule #1 is an investment Bible for our time. In fun, easy-to-understand words, Phil Town tells you how to buy quality stocks at a discount.” —Rich Karlgaard, publisher, Forbes magazine, and author of LIFE 2.0
“For the individual investor, Rule No. 1 should be, ‘Read Rule #1.’ This book debunks a lot of myths in the market and provides pearls of common-sense wisdom…Indeed, Rule #1 rules.” —Gene Marcial, Senior Writer, Business Week
“Rule #1’s common-sense, pragmatic approach is money in the bank. This step-by-step guide is methodically researched and terrifically accessible … Can you really beat the mutual fund mangers and so-called experts at their own game? Hell yes!” —Jonathan Hoenig, Portfolio Manager, Capitalistpig Hedge Fund, and regular contributor to Fox News Channel
“Rule #1 is probably one of the most inclusive, no nonsense, fundamental books about investing in the stock market I’ve ever read. This book is a must-read for everyone; from beginner students of the market to super know-it-alls.” —Danielle Hughes, President and CEO, Divine Capital Markets LLC
“A refreshing departure from those boring investing books… If you're tired of being shut out of how exactly the rich guys on Wall Street make money, this important book will teach you how to run with the bulls. It's priceless.” —Elizabeth MacDonald, Senior Editor at Forbes Magazine; regular, “Forbes on Fox”
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Top customer reviews
That's a great idea, and furthermore, Town explains quite clearly how you can go about doing it. As someone who's been in the investment business for 15 years, I still found this to be a helpful structure for thinking about investments. Beyond that, I'm going to do what Phil Town will tell you I won't and say that you can do this on your own.
Before you start, though, be warned. I don't think you can do this in 15 minutes a week. At least not at the start. While finding great companies that are wildly undervalued by the market is totally feasible, it is - no surprise here - not very easy to do. It may take some serious digging to find any companies that fir the Rule #1 criteria. You may look at a whole bunch of companies and only find candidates to put on your watch list and wait for their prices to come down. I wouldn't let that discourage you, but it could take some real work and some serious patience.
In the end, this investment program can be effective, but like any effective fitness program, it's going to take some real work. The outcome will certainly make the work worthwhile. Highly recommended.
You really have to take control of your financial security. For some it will be easy, because investing is fun, for others it will be hell. Phils book lays out one of the simplest plans I have seen. All you need to do is follow his plan and have a lot of patience. The trades do not show up every day, week, or even month, but they do show up and if you are ready you can profit from them easily.
I think Phils claim that it will only take 15 minutes a week is a bit of a stretch. Maybe after you spend a few hours narrowing down to your short list of companies to monitor it may be 15 minutes a week, but I have not reached that point yet. I have been spending about 20-30 minutes a day researching companies. I usually find 1-2 companies I like every single day. I run the numbers, put them on my watch list, then wait for them to enter into my margin of safety. I have placed three trades using this method and all three have made money. I have also traded about fifteen companies in my primary account that looked really good, but have not met Phils requirements. Fourteen of those made money.
This is not a get rich quick program. It will take some time and effort to make this work. Its not hard work, and it won't take you an inordinate amount of time to accomplish. But it will take time and effort. But then again, what doesn't?
I read through Rule #1 and what seemed like such an arduous task became simpler. It was not on the first reading, but by going back and reading through the one chapter showing the step by step process Doug and Susan use to evaluate The Cheesecake Factory and referencing prior chapters helped me gain a much better understanding.
What helps even more is to actually put numbers to work using Excel. To make this even easier to do I am using an Excel add-in called 'SMF Tools' that is free which I found in Yahoo! groups. Using SMF Tools you are able to grab stock and financial data directly from websites such as MSN Money and Yahoo! finance. I was able to put together a worksheet that pulls the necessary info from these sites to do the Rule #1 calculations. Automation is a very nice thing :-D
While its great to know how well the Rule #1 calculations are for a company, it is also worth noting that Phil Town also highly recommends that due diligence is done on a company to help create a solid fact based decision before taking a dive into investing your hard earned dollars in a stock.
Another aspect that I am still working on is a better understanding on using "The Three Tools" used to help know when it might be best to finally invest (or divest) in a stock.
This is an excellent read and I highly recommend it along with several other books on Value Investing like How Buffett Does It, Value Investing from Graham to Buffett and Beyond and The Warren Buffett Way among others. I think those in combination with this book lay the groundwork to you becoming a much better, educated investor. Lastly, don't forget about reading those annual reports either!
Most recent customer reviews
Read the book, and attended Phil's free workshop in Atlanta...amazing!
Why don't they teach this stuff in school.
You should be learning this stuff when we are kids.Read more