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10 principles of Value Investing


  1. One does not buy a stock, one buys a business
  2. When buying a business, know the business
  3. Price is what you pay, value is what you get
  4. Part of the risk in investing is the risk of paying too much 
  5. Ignore information at your peril
  6. Understand what you know and don't mix what you know with speculation
  7. Anchor a valuation on what you know rather than on speculation 
  8. Beware of paying too much for growth
  9. When calculating value to challenge price, beware of using price in calculation 
  10. Return to fundamentals; prices gravitate to fundamentals (but that can take some time)

From 'Accounting for Value' by Stephen Penman

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