Reddit reviews Warren Buffett and the Interpretation of Financial Statements: The Search for the Company with a Durable Competitive Advantage

As mentioned in this book:
http://www.amazon.com/Warren-Buffett-Interpretation-Financial-Statements/dp/1416573186/ref=sr_1_16?s=books&ie=UTF8&qid=1410454357&sr=1-16&keywords=investing+warren+buffett

These are some of the key indicators to look at.(You could obviously look at more) I look at these also and it really helps to paint a true picture of a company WHEN you use them and compare these to the same indicators of a competing company in the same space.(i.e Coca Cola vs Pepsi)

Income Statement

• 1. Gross Profit Margin
     
• 2. Operating Profit Margin
     
• 3. Net Profit Margin
     
• 4. Return On Equity
     
• 5. Retained Earnings
     
• 6. Diluted Earnings Per Share
     
• 7. P/E
     
     Balance Sheet Analysis
     
     
• 1. Cash & Short Term Investments
     
• 2. Long Term Debt
     
• 3. Current Liabilities
     
• 4. Working Capital
     
• 5. Working Capital Per Share
     
• 6. Current Ratio
     
• 7. Debt to Equity Ratio
     
• 8. Cash - Current Liabilities(do they have enough Cash to cover their current liabilities. A good company usually does)
     
     You also would want to look and see if they provide a dividend and have a history of increasing their dividends.
     
     When you compare these numbers from one company vs another - over say a 5-10 yr period - it really gives you a good analysis and the ability to see which company is doing better than the other.
     

Hi

Economics is the study of offer and demand. It's all about common sense.

Finance is the inverse of Investing. It's all about how you spread risk. Finance is the study of the relation between the hard working guys with no money who needs money, and the rich guys with money who want to avoid working.

There is a lot of jargon in economics, but it always boils down to big common sense.

For economics, I would suggest you to start with game theory. A good book to start is "the evolution of cooperation".

For finance, I would suggest you learn how to read financial statements. There is a good book called "Warren Buffet and the Interpretation of Financial Statements". The book has nothing to do with Warren Buffet.

http://www.amazon.com/Warren-Buffett-Interpretation-Financial-Statements/dp/1416573186

Do you have access to free printing by any chance? perhaps you can get an electronic copy and just print it?

I'm guessing that you're young, based on your talk about allowance. I don't recommend Intelligent Investor, as there might be some prerequisites that you are missing. The book is pretty accounting heavy terms, and you should have at least a basic knowledge of corporate accounting before reading it. Save this one for when you can look at all 3 financial statements and know what ever item on those statements mean.

You might this one to be more of an easier read: "The Little Book That Beats The Market". This one tries to get you to think about companies as businesses instead of tickers with a fluctuating price. You won't need any knowledge of corporate accounting for this one.
http://www.amazon.com/gp/offer-listing/0470624159/ref=sr_1_1_olp?ie=UTF8&qid=1394658640&sr=8-1&keywords=the+little+book+that+beats+the+market&condition=used

If you want to learn some corporate accounting, I recommend this one as it an easy read and catered to beginners. Also, it's $4 on Amazon so your allowance can go a long way.
http://www.amazon.com/gp/offer-listing/1416573186/ref=sr_1_2_olp?ie=UTF8&qid=1394658943&sr=8-2&keywords=interpretation+of+financial+statements&condition=used

I don't recommend Random Walk On Wall Street for your level. EMF is basically something that says the average investor cannot do better than the average investor (duh), in the grand scheme.

I would think twice about ANF because fashion is so crazy. I bought 100 shares of LB for $90, watch it go to $110 then drop to $80... I couldn't take it and accepted my loss. Athleisure was taking over and instagram influencers destroyed the super model. Now LB is trading in the 30's. Luckily my shares of Nike kept going up, hedging my loss. After this experience, it put me on a quest to study companies much more in depth. I would highly recommend reading Warren Buffet and the Interpretation of Financial Statements if you have the time.

https://www.amazon.com/Warren-Buffett-Interpretation-Financial-Statements/dp/1416573186

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But who knows. Maybe some instagram social influencer will blow up ANF and put it back on the map. Maybe Kanye will do a collab. You never know. Good Luck!

I read the books years ago, so I can't remember anything specific, but she might have been somewhat involved with BRK administrative duties? Don't quote me on that. The one book (Interpretation of FS) seemed like she just perused his acquisitions and found common attributes.