Disclaimer- I am a novice investor. I do not profess to be any kind of guru when it comes to the Stock Market, however I have a passion for the topic and enjoy sharing what I learn.
Two years ago I came across a book called, “Rule #1”. It’s a book on stock market investing based on the methods used by Warren Buffett. In the book Phil Town explains how to find great companies to invest in, determine a good price to buy it at, and finally when to buy the stock.
I should point out that reading this article should not replace the activity of reading the book. You could buy the audio book at the iTunes store and listen to it on your iPod. The rest of the content will only make sense for people who are familiar with the content of the book, “Rule #1 ”
Phil mentions in the book to search Yahoo Finance to find companies that interest you. Once you have a list of about 20 stocks, you should then research which ones pass the 4M test. This can take a while. There is a lot of calculating and organization that can go into this step. I prefer to go to www.stock2own.com to do the heavy lifting for me.
This website is great. All I have to do is enter the ticker symbol and all the calculating is done for me. They even calculate an MOS price for me at the bottom of the page. I can even change the calculation setting to my liking, or I can just leave it set to the default. Again, this information will not make much sense if you have not read the book, “Rule #1” by Phil Town.
Even with this great (free) tool, finding a great company that passes the 4M test can take a lot of time, it’s like finding a needle in a haystack. But this site takes the pain out of finding the gems.
Up next… How to use Stock2own.com’s information to make informed buying and selling decisions with your stock picks.