title: [Book Sharing] Choosing the Right Stocks, Saving Millions
published: false
date: 2021-10-23 00:00:00 UTC
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canonical_url: http://www.evanlin.com/reading-stock-saver/
---
Teacher Warren's Stock Saving Series: Choosing the Right Stocks, Saving Millions
Author: Zhou Wenwei (Warren)
Publisher: Smart Rich
Published Date: 2020/07/22
Language: Traditional Chinese
#### Book Recommendation Website:
- Books.com.tw: [Purchase Link](https://www.books.com.tw/exep/assp.php/kkdailin/products/0010863219?utm_source=kkdailin&utm_medium=ap-books&utm_content=recommend&utm_campaign=ap-202110)
# Preface:
This is the thirteenth book I've read this year. Because I'm a complete newbie in the stock market, although I've had a few lucky opportunities to buy stocks, I haven't seriously studied stock saving and related investment concepts. It's only recently that I've started to slowly learn some basic concepts, and this book shares how the author chooses stocks that are not affected by economic cycles using very simple concepts.
# Content Summary and Thoughts:
Whether you're just starting to save stocks, or you want to save stocks but don't dare to take action,
Do you always have the above doubts?
This time, Teacher Warren will continue to use his investment experience
To answer all the most common confusions of stock savers!
∥Build your own stock saving portfolio
Teacher Warren reveals his personal stock portfolio allocation for the first time, and teaches you how to allocate the holding ratios of fast-growing stocks, stable-growing stocks, and fixed-deposit stocks, leading you to bravely take the first step in saving millions of dollars in stocks.
∥"Long-term holding" is easier to profit than "making price differences"
Every time you want to buy low and sell high, but you always rush to buy when the stock price rises, and panic sell when the stock price falls? Instead of constantly buying and selling stocks with uncertain prospects, it's better to hold stocks with clear futures and stable profits for the long term, and from then on, bid farewell to the fate of small profits and big losses, chasing highs and selling lows.
∥Easily learn Teacher Warren's stock selection philosophy
How to correctly evaluate whether a stock is worth saving? With 6 conditions and 3 questions, you can also choose good stocks worth holding for the long term.
∥Stock price is not a reason to buy or sell stocks
Are you afraid to buy when the stock price falls, and even more afraid to buy when the stock price rises? Teacher Warren wants to tell you why you can't use the stock price to decide the buying and selling timing, and then teach you how to correctly judge the buying and selling points after choosing a stock saving target.
∥In-depth analysis of Warren's key holdings
How to analyze the competitive advantages and future prospects of holdings, and formulate a stock saving strategy? Taking 4 fixed-deposit stocks + 2 stable-growing stocks + 3 growth stocks as examples, take you to fully participate in Teacher Warren's stock saving thinking.
## Chapter Outline
### 1. Establish Correct Concepts, Only Be an Investor
To be a good stock-saving investor, you need to pay attention to the following related matters:
- Companies with economic moats
- Stock market crashes are the best time to enter the market
- When a stock market crash occurs, you should enter the market to buy, but you need to constantly review whether the company's advantages continue to be maintained.
- Don't have the idea of "if only I had known sooner," you need to think about the timing of entry and build your positions.
- Don't expect stocks to rise immediately after you buy them, that's just like buying a lottery ticket.
- Recognizing a company is not about buying for short-term stock price growth, but about recognizing their value and growing with them continuously.
The market is a voting machine in the short term, and a weighing machine in the long term.
- The only time to take profits is when the company's profitability changes, don't leave the company because of the stock price.
- Find food or basic life-related companies (not electronics stocks) to avoid economic cycle issues.
- Uni-President (2912) Although the dividend yield is not high, it has a 785% profit in 15 years.
- Using loans to arbitrage actually increases the pressure on stock positions. It will also reduce your resistance to stock market fluctuations.
- If you want to borrow money to save stocks, you need to confirm the following questions:
- If the dividend yield is 4% ~ 6%, it's actually not that high. (Personal credit loans are 3%, maybe a mortgage increase is low enough)
- Borrowing money to buy stocks is prone to pressure from fluctuations.
- Buying all at once is easily affected by fluctuations, affecting subsequent purchase plans.
### 2. Reject Short-Sightedness, Save Excellent Stocks
- Use six conditions to judge good stock-saving companies:
- Products or services have a monopoly or oligopoly (have an economic moat)
- Products or services are simple and easy to understand, and have durability.
- Profits are stable and growing over the years
- High gross profit margin, ROE greater than 15%
- Non-current assets account for less than 2 of after-tax net profit.
- The author recommends the food industry because it satisfies the following three questions:
- The company's production is singular, not something that changes
- The company's industry position, other competitors are not easy to challenge
- Can you easily predict the company's situation in 5 and 10 years?
- Choosing companies that are growing long-term is better than stocks with fluctuating prices
- Because big gains often can't be held for long, big drops are lost even faster.
- Recommended excellent stocks in the food industry:
- Charoen Pokphand Foods
- Great Wall Enterprise
### 3. Understand Buying Strategies, Effectively Reduce Costs
- Analyze how much money you can invest, classify investment categories, and allocate risks according to different categories:
- Fast growth 35%
- Stable growth 41%
- Fixed-deposit stocks 21%
- Cash 3%
- Stock saving strategy:
- According to the trend of the overall market, find the appropriate buying point
- Establish a purchase record to regularly accumulate the number of shares
- Use the decline to accumulate entry and build positions.
- Securities lending to increase income
- The lending rate is about 0.1% ~ 0.5%
- Even if you lend out your stocks during the ex-rights and ex-dividend period, you can still receive dividends through "equity compensation" without having to bear the second-generation health insurance.
- Stocks that are easy to lend: Telecom stocks (Chunghwa Telecom, Taiwan Mobile, Far EasTone), food stocks (Charoen Pokphand Foods), and Central Security.
### 4. Return to the Original Intention of Investing, Don't Sell Easily
- As long as the car is not broken, never change the car easily
- Stocks with economic moats will continue to profit in the long run.
- Track the focus:
- Frequent profit decline, you can temporarily stand still
- The company becomes unpredictable, you can get off and watch
- Eliminate the bad and keep the good stocks
### 5. Warren's Stock Saving, Full Analysis of Advantages
This chapter mainly shares the author's research insights on his stocks, and I really admire the author's detailed observation of the stocks he holds.
The main stocks are:
- Fixed-deposit stocks: Telecom three giants, Central Security
- When a systemic disaster occurs in the stock market, these are also the stocks that are least affected.
- Stable growth: Demai
- Fast growth: Jih-Yu
Some tips are recorded:
- A dividend yield higher than 5% is a good buying point.
- Continuously understand the company's growth and revenue to allocate the number of shares held.
## Thoughts:
There are many complete basic philosophies, and they are substantiated by many historical data. Truly worthy of being a teacher, the whole book is easy to understand and can be deeply remembered. The last chapter is also quite useful, the author's in-depth research on individual stocks can help you understand how to analyze the stocks you hold. Building your own phased entry strategy is highly recommended to read this book carefully, it is very practical.
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