This is the general investment checklist that I go through each time when I examine an investment opportunity. This is long-winded and generic. This won’t be exhaustive enough to cover all the possibilities nor specific enough to cover specific aspects of individual companies. Not all the points are applicable in all cases. Many are open questions of which the answers can mean opposite things in different circumstances.
The purpose of having this in place is to avoid silly mistakes, to slow myself down and to minimise the influence of my own emotion, laziness and blindspots. This will be a living document that I’ll add or delete points when I have newer insights upon reflections.
Utilising an investment checklist is probably a Mungerism.
Rebuild the history and the profile of the company
- Filings and public information
- 5-10 years of public announcements (financial reports, proxy statements, annual reports, tax filings)
- Differential analysis: what mgmt said in one year vs what happened in the next year; things said in different statements
- Recent new releases
- Industrial or government data and statistics
- Competitors, suppliers, customers and products
- Media coverage of company and mgmt
- Court cases?
- Background check: mgmt, accountant, lawyer, cross-holding parties