My top 10 Rules in Stock Investing
This is a follow up to my newbie's guide . It is based on what I've learned in the past 5 years and how I invest today. I started investing in April 2017. At first, I did not know what I was doing, but once I started to learn the ins and outs of picking stocks of solid companies, I started to outperform the S&P 500 by 2018. Since then, I more than doubled S&P 500 total returns. This chart shows my performance without any margin. Once I started using margin in 2021, my results further improved (like over 100% annually). Some smart use of options strategies bring additional returns. 1. Company must have wide moat This could be any sort of competitive advantage, such as a good brand name (like Apple), or having technology that is better than competitors (like Apple). It could also be network effects (like Facebook, Amazon). 2. Must be undervalued, taking into account current valuation and future growth. Low PEG ratio (1.0 is good), good forward P/E ratio. PEG = PE...