Warren Buffet

I learnt of Warren Buffett as the world's richest person who made his wealth through investing. He is my second role model and greatly influenced my investment approach.

I started devouring books on Warren Buffett early in my university days but the books were mostly centred on his life story etc and does not shed light on his approach until Mary Buffett's books came out.

I utilised some of the knowledge and came up with my own criteria for stock pickings:

1. Only buy from companies that have established track records i.e. no IPOs, no China based companies (there have been too many companies delisted and I would rather not touch any of these)
2. Companies should have market presence over others (oligiopoly or monopoly in the market)
3. Companies' product/service is easily understandable (I know where the company makes its money from)
4. Profits per share - should be upward trending over past 10 years
5. Revenue should be trending upward for past 10 years
6. Dividend payout is decent (more than 3%) so that while I wait for the stock prices to go up, the dividends provides me extra cash
7. Total cash holdings should be able to service total debt (both long term and short term) or a large part of it (this can be quite hard to meet) as it signals that the company is able to weather economic slowdown better than those who are laden with debt.
8. Current stock price is below Net Asset Value (this is the cue I take to buy the stock)

With these criteria, I have bought shares from these companies

• Keppelcorp (still holding)
• Hong Leong Finance (still holding)
• Keppeland (sold to Keppelcorp)
• SMRT (sold)
• Capitaland (still holding)
• Raffles Medical (sold)
• Super coffee mix (sold)
• ASL Marine (sold)
• Comfortdelgro (sold)

In my subsequent posts, i will share in more details the stocks I have bought.