I'm pretty sure Warren Buffett would approve of this book

books:


	• Rule #1: The Simple Strategy for Successful Investing in Only 15 Minutes a Week! Phil Town Three Rivers Press, 2007 - 336 pages average customer review:based on 152 reviews view larger image
	for more information click here

highly recommended

Rule #1

Great book about the strategy of investing. Solid advice written in practical language for the novice; good even for seasoned "I know it all" investors and investment consultants. Common sense to the max!!!

A Clear Read

I first saw Phil Town on "The Millionaire Inside" on CNBC, which prompted me to pick up his book. I found his book provides clear, step-by-step instructions on how to buy wonderful companies that have personal meaning, and purchasing them for at least a 50% discount, and then watching how they perform in the market. He introduced "tools" to check every day for a couple of minutes, depending on how many companies you purchase, but he advises to start slow with one company until you get familiar with what you are doing. I thought this book was great and has motivated me to find my first company to invest in and start earning those 15% returns.

for more information click here

I'm pretty sure Warren Buffett would approve of this book

First off, I was actually embarrassed to pick and read this book given its cheesy marketing. On the surface it looks like a ridiculous infomercial with outrageous claims. For example, the author claims he turned $1000 to 1 million in 5 years. That is approximately a 400% rate of return. Very impressive but I was and still am skeptical. 15 minutes a week is also an exaggeration. He also portrays himself as a guy with average intelligence and drive. I don't believe that and I mean that as a complement to Phil Town. He strikes me as well read, driven, and with above average intelligence. He is also an outstanding teacher.

But getting past the marketing, I am extremely impressed with Town's book. It is very clearly written, engaging, and has sound investment advice. As a Warren Buffett fan, I have tried to copy his investment strategy but no other time have I seen his strategy laid out so clearly for readers to follow. Of course, I believe there are some points that diverge from the Buffet school of investing. For example, I don't believe Buffett would endorse technical analysis as much as Town. Partially this is due to Buffett dealing with enormous sums of money but even if that were not the case, I don't think Buffet would ever talk about tools like stochastics or MACD. I understand Town's rationale for introducing these concepts to individual investors but am still skeptical. Furthermore, his explanation of how these tools work was unsatisfactory. In all fairness, he does admit that he does not want to go into details as to how the tools work.

Phil Town does an outstanding job spoon-feeding his methodology. He definitely deserves praise for that. The book is valuable to the reader especially for a non-professional investor, but if you really step back and try to understand what drives his model, you will find it to be a very simple and perhaps un-elegant model. Basically you look at past growth rates and assume that the company will continue its trajectory (huge assumption). If the growth rates are over 15% (which is rare in a company that has been in business for awhile. Microsoft grew at about 8%) and the current PE ratio is significantly below historical levels (or 2 times growth rates) then you buy the stock. Using this methodology does give the investor a huge margin of safety but good luck finding companies that meet the criteria. If they do fit then you have to find out if there is a good reason why they are trading at such a large discount.

Phil Town does a great job enlightening readers but I think he probably makes most of his money now by giving advice and not by actually investing his own money.

for more information click here

reviews: 1, page 2, 3, 4, 5, 6, 7, 8, 9, 10, 11

hot

not?

What's your opinion?

Write a review and share your thoughts!

recommendations

Books that inspired "DON'T LOSE MONEY! (in the Stock Markets)"
Brad's favorite books of all time
My favorite Investments books
My Favorite Investment Books
Reading on "Wealth"

search for books
the simple, investing, minutes, rule, simple, strategy, successful, week

Impressum / about us