Wednesday, November 1, 2006

Financial analysis made difficult

Here's a blog from Ramit which articulates my idea of reading Analyst reports. The analyst reports also burden you with an information overload. And it pressurizes your thinking, taking you away from enjoying the process of investing.

I wd think that one should start with looking for the right questions first and then look for answers. Instead of a template based analyst report.

Even Warren Buffet says and I quote :

"Almost everything we learn is from public documents.... We do not find it particularly helpful to talk to managements.... The numbers tell us a lot more than the managements. We don't give a hoot about anyone's projections. We don't want even want to hear about it."

He had even greater scorn for analysts: "I don't read any analyst reports. If I read one, it's because the funny pages weren't available. I don't know why anyone does it."

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