K's Learning Diary

For a long term investor, it is important to know that the company that you are investing in is able to invest their profit back into the business well and deliver good Book Value growth (in addition to steady Dividends). Hence, another number to watch out for is the Return on Equity . Return on Equity = Net Income / Share Holder Equity or in term of pershare numbers Return on Equity = Earnings per Share / Book Value per share Notice that with bond investments, you always get back the par value plus all the interests over the years when the bond matures. However, when you invest in good companies, not only do you get dividend payments over the year, you can also benefit from Book Value growth as the company reinvest its earninings every year.

After we have determined that a company is Stable, Understandable, Predictable ,  and can manage debt well , how exactly do we figure out how much the company is worth? In other words, how do we calculate the Intrinsic Value of a business? You should also have some understanding of bonds before attempting these calculations. The idea is basically to judge how much of the Earnings (EPS) translates into Book Value growth and Dividend payout over future years (taking into consideration the amount of debt to pay off, future economic characteristic of the sector...etc), this is your expected gain.  On the other hand you have the expected gain of a fixed cash type investment (bonds or bank accounts that has negligible risk). You can then compare the two and work out for the same amount of money, how cheap the stock has to be in order to give you the same or better returns than the fixed dollar alternative- to make it worth while to invest in stocks rather than bonds.

Restoring a classic car to its full former glory is a uniquely romantic endeavour for auto aficionados. These rolling antiques are iconic time capsules that capture the essence of style, culture, and engineering from past eras. As many of my car-loving friends would agree, vintage automobiles represent a class of antique like no other. Each car has its own iconic silhouette, gleaming chrome, and roaring engine that makes it a driving work of art. That's why I admire the meticulous work of this restoration shop so much. They take rusty, dilapidated classics that look ready for the scrap heap and painstakingly bring them back to perfection. Even as someone who isn't necessarily a car buff, it's incredibly satisfying to see them transform a decrepit old clunker into a vehicle that looks ready for display in an art museum. The level of care and attention to detail they devote to each car is astonishing. The restored interiors look factory-fresh, while the bodywork's elegant