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The Number #1 Concept Of Stock Market Investing

Aug 20, 2023

Hello Stoic Investors,

Today I want to talk about a core investing concept.

 

I get it, being an investor is hard.

 

There is an ocean of stocks to choose from.

You’re constantly bombarded with news.

And even if you somehow bypass these two things it can be an emotional burden.

But what if I told you it doesn’t have to be that way?

 

There is a concept that legendary investors, including the great Warren Buffett, use all the time.

And today, I’m teaching it to you for free.

 

The number #1

Do you know what every single human being in the world has in common?

Mistakes.

We all make them.

 

Strangely, few of us prepare for that. And that is also why so many people fail in the stock market.

They leave no room for error.

So, how do you leave room for error?

Simple.

 

Always have a big margin of safety

 

Warren Buffett once said:

"The three most important words in investing are margin of safety."

 

He also explained it another way:

"On the margin of safety, which means, don't try and drive a 9,800-pound truck over a bridge that says it's,

you know, capacity: 10,000 pounds. But go down the road a little bit and find one that says, capacity: 15,000

pounds."

 

How do you translate that into investing?

If you’re a visual learner you’re going to love this.

 

 

But how do you find that “Margin of Safety”?

 

How to find the margin of safety

To determine the margin of safety, you need to assess the company's intrinsic value.

 

Look at its financial health, growth prospects, and industry trends. Analyze its earnings, assets, and

liabilities.

This might be a bit more challenging, but I have faith in you. And if you have any troubles, feel free to

contact me directly.

 

Once you have the intrinsic value estimate, subtract a margin of safety percentage.

This provides a cushion against any unforeseen challenges.

A higher margin of safety means a better chance of weathering market fluctuations.

 

If you’re an active investor, this is something you need to use all the time. No exceptions.

The stock market can be very unpredictable.

It’s better to be safe than sorry.

 

So, note down these points and start growing today:

  1. When investing in stocks, it's crucial to have a margin of safety—a buffer that protects you from potential losses
  2. "The three most important words in investing are margin of safety." – W. Buffett
  3. A higher margin of safety means a better chance of weathering market fluctuations

 

See you again next week.

 

Whenever you're ready, here is how I can help you:

1. Take advantage of all our Free Resources and start your journey as Stoic Investor 

2. Book a Free Consultation to ask your investing questions and we will point you in the right direction

3. Watch hundreds of Video Testimonials of Stoic Money Clients from 25 different countries

About Me

I am Vittorio Rigato, the Investing Coach behind Stoic Money.

I invested for more than 8 years, both for myself and by managing the 7-figures retirement account of my family.

After my¬†Master Degree in¬†Finance & Management,¬†I worked in the FinTech industry in Frankfurt (Germany) and managed financial products with value up to ‚ā¨100 Millions.

In 2021 I have founded Stoic Money to teach employees and professionals worldwide how to invest to reach $1,000,000 Net Worth and beyond. Many of them reviewed Stoic Money service with a video testimonial here.

Multiple Finance News Websites like Yahoo Finance and Euronews talked about Stoic Money mission and services.

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