![]() If you had a silver-bullet and you could put it through the head of one competitor, which competitor would you choose and why? You will find who the best guy is in the industry. I would ask every CEO, ― If you could only buy stock in one coal company that was not your own, which one would it be and why? You piece those things together, you learn about the business after a while. Funny, you get very similar answers as long as you ask about competitors. Every time I was interested in an industry, say it was coal, I would go around and see every coal company. I would go out and talk to customers, suppliers, and maybe ex-employees in some cases. “I did a lot of work in the earlier years just getting familiar with businesses and the way I would do that is use what Phil Fisher would call, the ― Scuttlebutt Approach. Investor sentiment, however, is usually wrong, at least over the longer term.” Joe Vidich “There is a big difference between informed sentiment, like CEO’s, and investor sentiment. “You might even find a new idea through management’s discussion of their competitors.” Whitney George “When a management team compliments a competitor, this can be like gold dust for an investor.” Marathon Asset Management “Following Soros’s practice too, Druckenmiller stayed in touch with company executives, reckoning that on-the-ground stories from firms could provide early warning of trends in the economy.” Sebastian Mallaby A company that was feared by its rivals must be doing something right.” The Davis Dynasty “One of Davis’s favourite questions was ‘ If you had one silver bullet to shoot a competitor, which competitor would you shoot?’ He’d get the answer, and make a note to research the competitor’s stock. "Go to five companies in an industry, ask each of them intelligent questions about the points of strength and weakness of the other four, and nine times out of ten a surprisingly detailed and accurate picture of all five will emerge." Phil Fisher ![]() This will provide important insights into the industry that even those who work their whole life in the industry would not realize.” Warren Buffett Then ask which of their competitors they would short. Also, ask the management of each company which competitor they would be willing to put their net worth in for the next 10 years. “Start by looking at 7-8 companies in the industry and ask the management typical due diligence questions. This was a very effective early warning system. I always ended these discussions by asking: which of your competitors do you respect most? When a CEO of one company admits that a rival is doing a good job or better, it’s a powerful endorsement. The upshot was that I often went out and bought the other guy’s stock.” Peter Lynch “My personal rule was that once a month I ought to have at least one conversation with a representative of each major industry group, just in case business was starting to turn around or there were other new developments Wall Street had overlooked.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |