While the professor’s background is investing, this course is to a great extent a study of the elements that make a business great. As a result this class provides a sound intellectual framework to think about business in general, and as such it is equally appropriate for students who will work for a great business, build a great business, or invest.
Value Investing is simply the purchase of any asset at a price that is significantly less than its true value. To learn how to do that when investing in common stocks, Warren Buffet has said investment students need to study two things:
• How to value a business.
• How to think about market prices.
Through practical work as business analysts, the students in this class will primarily learn and intensely practice the skills and framework necessary to understand (and therefore value) a business.
The professor has historically found the most value by investing in great (or future great) businesses. As a result, A SIGNIFICANT part of the course will be spent on:
• Detailed study of what makes a great business, and how to identify/build great (or future great) businesses
• Realization that to accomplish anything "great", it is enormously helpful to identify, understand and align yourself with certain "truths” (For example the necessity of a broad understanding of people, group dynamics, the importance of independent thinking, basic probability, basic finance and accounting, EVA, the implications of proper focus, etc., etc.).