“Own companies that are like bonds, they’re so secure.” – Phil Town
This week on the InvestED podcast, Phil and Danielle continue their discussion on checklists, revealing the next six points on their list you should know about a company before investing.
Phil discusses the importance of owning companies that are secure like bonds. Warren Buffett calls these equity bonds. He says, why would you buy a bond when you can buy the company and get paid in a dividend and let that dividend grow.
How do the Rule #1 Investors find these companies? They use a checklist of course.
This week Phil and Danielle dive into the following questions to know when investing in a company:
- The history of the business and how it has changed over time
- Why businesses fail in the industry
- Specifically, how the business fails
- Why the industry will be going strong in 10 years
- The key performance indicators the organization follows religiously
- The key risks a business is taking in the industry
If you can’t answer all of these questions discussed in a simple sentence, it’s too hard, do not invest in the business.
Want to learn the most important questions to answer when creating a checklist? Join us on the podcast today!
- Invested by Phil and Danielle Town
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