(1/n)
LEARNING 1:
Lately, I was trying to find out what criterias should we use in our stock picking to beat the benchmark and make above average returns & came up with 2 factors:
- Growth Story
- High barriers to entry
Now, you think by yourself of holding a company that has high barriers to entry (so, it becomes very difficult for other companies to enter and that leads to less competition) & the future prospects of the business are extremely attractive (say there is demographic change which will be in companies favour).
So, now what do you think is the companies probability of doing well in the future, given no competition and high anticipated demand for its products?
LEARNING 2:
I personally think that understanding of the business is more important then its valuations.
No matter how cheap you buy it, but if the company is not doing the business properly or is NOT ABLE to do the business properly then you are ought to lose your invested capital.
You have to spend reasonable amount of time in understanding the sector and the company, in and out.
Although, you can speed up this process by reading brokerage firms āInitiating Coverageā reports, taking the BRIEF about the company and the sector from the Investor Relations department of the company and offcourse reading about the conpany on Valuepickr 
End of the post.
