BIO: Robert Leonard is the VP of Growth & Innovation at The Investor’s Podcast Network, Podcast Host of ‘Real Estate 101’ and ‘Millennial Investing,’ ex-W2 Accounting and Finance professional, as well as a stock and real estate investor.
STORY: When Robert first got into the financial markets, his research into companies he invested in was purely quantitative. He never paid attention to details such as the actual business itself, its prospects, or where the industry was going. His focus was purely on the numbers. This led him to make a couple of bad investments.
LEARNING: There is more value or at least equal value in the qualitative factors than there is in the financials. Stop just focusing on intrinsic value and start looking at the whole picture.
“There is arguably more value or at least equal value in the qualitative factors of a business than there is in the financials.”
When Robert first got into the financial markets, his understanding was that value investing was simply following a discounted cash flow (DCF) model. So, for the most part, he just relied on the DCF model and made many investments based on quantitative factors.
Robert never looked at the actual business itself, its prospects, or where the industry was going. His research was purely quantitative. After making a couple of bad investments, Robert found out that investing is not just about the numbers. It’s not always just about the valuation; although that is important and should be considered, it’s also about the qualitative aspects of the business.
There is more value or at least equal value in the qualitative factors of a business than there is in the financials.
There’s so much value in the qualitative data so pay attention to it.
You can add value by being steady in your emotions and not let them get the best of you even when the market is going crazy.
Stop just focusing on intrinsic value and start looking at the whole picture.
Completely understand the business you want to invest in and make sure it’s within your circle of competency. If you can, use their products or services first. It’s worth a little bit of money that you’re going to put into seeing how the business works, seeing what their products and services are and their quality.
No. 1 goal for the next 12 months
Robert’s number one goal for the next 12 months is to scale his new stock investing software platform to help investors.