9) Pillar 2: Doing The Math, Verifying Replicability & Assuming Responsibility: Be curious in investigating reality. Be open to exactly what reality entails, what the empirical evidence actually tells you, and how you can make practical use of it. Sometimes the truth hurts, but better sooner than later, better the ego than the wallet. Don't be stubborn; Look for and allow new empirical data to change your investment thesis. You can't close your eyes to reality. Well, you can, but that won't stop the train, lion or stock market.
10) Pillar 3: Patience To Finalize Your Research & Wait For Optimum Entry And Exit Points: As a value investor I'm used to waiting; sometimes when buying a cheap company in the middle of a bursting bubble; sometimes when holding off buying when other investors are chasing story stocks. Bide your time and wait until the target manifests your desired margin of safety.
11) Pillar 4: Checks And Balances That Counter Your Counterproductive Emotions: Learn how to defend against your most destructive emotional whims, beginning with the two big ones that all investors face: hubris and complacency.
12) The FAMINE 5-Step Investment Process (F+A): Filtering And Analyzing: Learn how to filter and analyze potential stocks with important metrics such as Price/Earnings, Price/Book, Price/Sales, EV/EBIT, P/B, Dividend Ratio, Debt/EBITDA and Price/Cashflow.
13) The FAMINE 5-Step Investment Process (M+IN+E): Modeling, Investing & Evaluating. Learn how to build a financial model used to arrive at a stock valuation (for example, based on the metrics above), how to size your investment appropriately, and the key factors to keep tabs on as you evaluate this investment over time (and decide to buy more or sell your position).
14) The Most Effective Key Ratios To Screen For Attractive Stocks: Some of the most effective indicators and ratios include Hussman’s cyclical margin adjusted CAPE, relative P/S, relative P/E, P/CF, EV/EBIT, EV/ EBITDA, DSO change, RoE, P/B, Non Fin Mcap/GVA adjusted for international business.
15) Key Ratios Summary: Features And Drawbacks of Using The Best Key Ratios: Although it all boils down to cash flow and valuation in the long term, shorter term human herd behavior is a much stronger force. All key ratios are flawed, none is enough in itself, all are unrealities that enable triangulation of the reality signal.
16) Syding’s Screening process: A Practical Stock Search; Using P/S, Growth Trends, Margins, Balance Sheet And CEO Comments: I go through my own personal, typical, stock search process.