Value investing is simple. Its definition, best described by famous investor Joel Greenblatt, rings clear:
“Figure out what a business is worth, and then try to pay a lot less for it.”
Sounds easy right?
Sure... but if it was so easy, wouldn't everyone be doing it?
Well they aren’t. And that’s because in reality it's not easy to be a value investor. It’s a lot of work!
Subscribing to an investment newsletter is basically like hiring your own analyst so you can spend your time elsewhere… like with friends and family or maybe even researching more companies (if you’re a nerd like me).
But there’s a problem.
The quality of investment newsletters varies WIDELY. The fact is, most fail to provide the value their price tag claims to offer.
A majority of publications focus on the latest stock tip, the hottest sector poised for “tectonic-shifting” growth, or the “one-and-only” dividend stock you’ll need for the rest of your life…
Now of course, like a blind squirrel, these newsletters may hit a big winner eventually -- but their value disappears as quickly as it arrived.
Taking an aggregated view, most newsletters aren’t worth their price because they:
Cover stocks that house thousands of Investment Banking analysts — providing no informational edge.
Highlight “hot” stocks — i.e. the type of stocks that show up on CNBC’s Fast Money. These are stocks that people love to talk about at cocktail parties, but that also draw in “stupid” money.
Pigeonhole themselves into one style of investing — market cap, P/E ratio, sector, etc. — often leaving low-hanging fruit for the taking because it doesn’t fit their M.O.
Refuse to dive deep into the philosophy of investing, the pitfalls, the emotional turmoil of watching stocks fall after buying — this creates an unrealistic picture of instant gains without the work.
Fail to review their losing picks and what they can learn from them — resulting in a dishonest portrayal of track records.
Now I can’t guarantee I’ll provide you with countless 20-bagger investment picks. And I can’t guarantee the Value Ventures portfolio will kick ass over the next 12-months.
In fact, any newsletter that guarantees returns is either ignorant, dishonest, or a combination of the two.
But… I can guarantee top-notch research into off-the-beaten path companies, honest and transparent thoughts on positions (both winners and losers), as well as in-depth analysis of value investing methodologies and philosophies.
The name of the newsletter has a meaning. It’s what I want this publication to be: an adventure into understanding businesses, competitive advantages, management teams and capital allocation decisions — regardless of market cap, liquidity, or sentiment.
Investing in spin-offs is a great strategy for one reason: forced selling.
During a spin-off, the parent company gives shares of the spin-off to its existing shareholder base.
These existing shareholders then have a decision to make...
Do they keep these new shares of a business they expect to own?
Or do they dump their shares because the amount is so small it doesn't matter?
They almost always choose the latter.
frontdoor, Inc. (FTDR) was spun-out of Service Master, a provider of residential / commercial maintenance services.
You’ll get it for free when you subscribe to Value Ventures a 42-slide presentation that’ll teach you exactly how to find spin-offs like frontdoor, Inc. (FTDR).
But spin-offs are just one of the weapons in our arsenal.
In our newsletter I’ll teach you many other value investing methods that we also use to earn outsized returns. And of course, you’ll get a front row seat to how we do it in real-time.