Hello friends, in today’s, article we see how warren buffet use the method for his investment and they become the investment secret of warren buffett, that come form the chapter 2 of common stocks and uncommon profits book. This secret of warren buffet help him to become the $100 billion club person.
Chapter 2: What ” Scuttlebutt” can do (Investment Secret of Warren Buffett)
So friends, we know up to now is form stock market we can make a lots of money, just finding outstanding company and invest in that.
How to know we this company is outstanding company or what, this is only possible by using the Scuttlebutt method. (Investment Secret of Warren Buffett)
So many people says this method, we can’t apply, so authors say’s those people, if you want to find out the outstanding company, you should have to follow it.
So let’s starts, you have to talk with customer, suppliers, competitors, management and former employee, by asking this peoples you get the clear image of company of relative strength and weakness. this people are right about the company, because they directly involved in the company connection. so this people know better than the outsider broker. (Investment Secret of Warren Buffett)
You can also talk other people like research scientist in universities and government company. And you can also talk with executives of trade associations and former employee of the company.
The former employee help you to know about companies strength and weakness insights so whatever you get the information, you have to make them cross check, of that information because it is very important.
Some time employee is fired and they talk bad thought on the company, so you have to ask them question like, ” why are you leave the company.” So this question help you to know his thought is right or wrong about the company. (Investment Secret of Warren Buffett)
It is not necessary to get you whatever information about company from any part is almost true as company show you. so you have match it. and compare this information and that information and use the common sense and get the right outstanding company.
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If Company is outstanding, then average investor also get clear image of that outstanding company. If you like a company by scuttlebutt method, then you to do talk to the management. (Investment Secret of Warren Buffett)
After meeting management people, you can fill the gap present in your clear image of outstanding company.
if you talk five companies of any industry, and you have to talk about other 4 company to one companies that you have to invest in that. After asking this, you get the best information about the companies and there strength and weakness. And you get the clear image, which company is better than the other company. (Investment Secret of Warren Buffett)
While following scuttlebutt method ( talking customer, supplier, employee, former employee, competitors, and management peoples) we get the information that we know which company is outstanding or not.
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But now question is what actually we have to talk and what we have to know about asking questions they will we see in next chapter. (Investment Secret of Warren Buffett)
So, this is all about the scuttlebutt method, they ken(Philip A. Fisher) talk about the diamond point of this book.
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