Purpose
This is a blog about investment not speculation. For an adequate definition of the difference between the two, I will use Benjamin Graham’s summation in his book "Security Analysis" :
“…An investment operation is one which,
upon thorough analysis promises safety of principle and an adequate
return. Operations not meeting these
requirements are speculative…”This is a blog about investment not speculation. For an adequate definition of the difference between the two, I will use Benjamin Graham’s summation in his book "Security Analysis" :
This does not mean that losses will not be made, you will make mistakes in your analysis, companies will disappoint, either through their own failures or from events outside of their control. With this in mind it is best to eliminate two types of companies from the universe of quoted companies that you will be screening:
Banks – their method of
operation, how they make money and disclosure is far too opaque to enable you
to sensibly analyse a value proposition.
Insurance companies –
They intentionally expose themselves to events outside of their control, that
have the potential to materially affect their financial well being.
Owning shares in those companies, because
of the factors mentioned, is more akin to speculation than investing. All other companies are available for
screening and analysis, to determine whether they meet strict criteria for
inclusion in your portfolio.
The journey of investing should be both
profitable and enjoyable and add to your understanding of an increasingly
complex world. 
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