“Under conditions of complexity, not only are checklists a help, they are required for success.”Atul Gawande, The Checklist Manifesto
By John Kingham
If you’re new to the world of stock picking and value investing (or even if you’re not) then this page has a few tools which you might find useful.
0. Learn about defensive value investing
- Before you use the tools on this page you should have at least a basic understanding of defensive value investing.
1. Find potentially attractive investments
- Once you have a basic understanding of my approach, you’ll need to find some consistent dividend-payers to apply it to. You could use:
- The AJ Bell Dividend Dashboard (a free quarterly newsletter)
- Sites such as DividendChampions.UK which list consistent dividend payers and dividend growers
- The UK Value Investor stock screen, which isn’t free, but does list about 200 FTSE All-Share dividend payers and ranks them according to their growth, profitability, valuation and other factors.
2. Analyse a company’s financial results
- After you’ve chosen a company you’ll need to review its financial track record.
- Here’s the latest version of the Company Review Spreadsheet (Google Sheet) which I use to review companies on a regular basis.
- Here’s an old version of the spreadsheet (MS Excel) which matches the metrics used in my book, The Defensive Value Investor.
3. Analyse a company’s business
- If a company makes it past the various rules and hurdles in the spreadsheet, the next step is to review its business in more detail.
- Here’s the latest version of the Company Review Checklist which I use to review companies before adding them to the model portfolio.
4. Manage the portfolio to reduce risk and increase returns
- Managing a portfolio of shares is like managing a garden. There’s always something to do, such as trimming back fast-growers and replacing weeds with something healthier and more attractive.
- Here’s a Portfolio Review Spreadsheet which I use to track the diversity of the model portfolio.
- To track performance, I use this Portfolio Performance Spreadsheet. Some of the ideas behind the spreadsheet are outlined in this blog post on how to measure your portfolio’s returns.