Brian Feroldi Profile picture
May 5, 2021 โ€ข 13 tweets โ€ข 5 min read โ€ข Read on X
10 Highly Underrated Books About Money & Investing

A ๐Ÿงต
1/ 100 Baggers by @chriswmayer

This book studies the best-performing stocks of all time and gives lessons for how to find the next ones
2/ Beyond Wealth by Alexander Green

A collection of life lessons by Alexander Green, who is a former money manager that gave up HUGE money to live a better life

This is the book that I re-read the most
3/ The Education of Millionaires by Michael Ellsberg

This is like "Rich Dad, Poor Dad", but with FAR more details. A superb read with tons of practical advice.
4/ The Emotionally Intelligent Investor by Ravee Mehta

If your behavior is wrong, what you invest in won't matter.

Ravee breaks down how to make sure you get your investing behavior right.
5/ Investing for Growth By Terry Smith

A collection of Terry Smith's letter to investors. Terry is a wonderful investor with a terrific track record. He buys high quality companies and then does nothing.
6/ The Joys of Compounding by @Gautam__Baid

A book about "value investing" that also touches on self-learning and business wisdom.
7/ The Millionaire Fastlane by MJ Demarco

A book filled with practical advice for how to speed up wealth creation
8/ The One Page Financial Plan by @behaviorgap

I love it when books take a complicated subject and makes it simple. This book does just that with money & financial planning.
9/ Only The Best Will Do by Peter Seilern

I'd never heard of Seilern before, but he also invests for high-quality growth like Terry Smith. This book is all about why you should find & invest in the best businesses you can and ignore everything else.
10/ Warren Buffett & The Interpretation Of Financial Statements by Mary Buffett

Want to learn accounting? This book is fantastic! It goes line by line through financial statements and shows you how Warren Buffett thinks of them
If you want a list of other great books that are more mainstream, here are the top 15 books that changed my financial life:

If you are curious about the book that I'm writing, all the details that have been released thus far can be found here:

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More from @BrianFeroldi

Sep 6
Tangible vs Intangible Assets.

What's the difference?

Here's everything you need to know: Image
They confused me until I discovered an easy way to distinguish them:

๐—ง๐—ฎ๐—ป๐—ด๐—ถ๐—ฏ๐—น๐—ฒ ๐—”๐˜€๐˜€๐—ฒ๐˜๐˜€ ๐—–๐—ฎ๐—ป ๐—•๐—ฒ ๐—ง๐—ผ๐˜‚๐—ฐ๐—ต๐—ฒ๐—ฑ

๐—œ๐—ป๐˜๐—ฎ๐—ป๐—ด๐—ถ๐—ฏ๐—น๐—ฒ ๐—”๐˜€๐˜€๐—ฒ๐˜๐˜€ ๐—–๐—ฎ๐—ป'๐˜ Image
Another major difference.

- Tangible assets are depreciated

- Intangible assets are amortized Image
Read 6 tweets
Aug 31
How to analyze an Income Statement, FAST.

Warren Buffettโ€™s 8 Income Statement 'Rules of Thumb': Image
1: Gross Margin

๐Ÿงฎ Equation: Gross Profit / Revenue

๐Ÿ‘ Rule of Thumb: 40% or higher

๐Ÿค” Buffett's Logic: A consistently high gross margin signals that the company isnโ€™t competing exclusively on price. Image
2: SG&A Margin

๐Ÿงฎ Equation: SG&A Expense / Gross Profit

๐Ÿ‘ Rule of Thumb: 30% or lower

๐Ÿค” Buffett's Logic: Wide-moat companies donโ€™t need to spend a lot on overhead to operate & convince consumers to buy. Image
Read 11 tweets
Aug 30
Some stocks are STRONG BUYS when they fall

Other stocks are SELLS when they fall

How can you tell the difference?

Watch for these 5 financial yellow flags: Image
1) GOODWILL WRITEDOWN

This represents the premium a company pays for an acquisition above its fair market value.

If thereโ€™s a major goodwill write-down on the Income Statement, it means management has wasted a TON of capital. Image
2) GROSS MARGIN DECLINING

1: The competition is forcing me to lower prices
2: Demand is weak
3: My suppliers are raising prices

Either way, it can be a thesis-busting development Image
Read 9 tweets
Aug 29
Capitalism is brutal.

If you invest, you MUST know how to identify a moat.

Here are 9 financial โ€œrules of thumbโ€ that Warren Buffett uses to tell if a company has one: Image
1: Gross Margin

Found: Income Statement

Formula: Gross Profit / Revenue

Moat: Consistently above 40%

No Moat: Under 40% & volatile Image
Buffettโ€™s logic:

A consistently high gross margin signals that the company isnโ€™t competing exclusively on price.

A high gross margin also provides ample gross profit to pay expenses and leaves money for shareholders.
Read 22 tweets
Aug 27
How to analyze an income statement in less than 2 minutes: Image
The income sheet is one of the three major financial statements.

It shows a companyโ€™s:
โ–ช๏ธRevenue (Sales)
โ–ช๏ธExpenditures (Costs / Expenses)
โ–ช๏ธNet Income (Earnings, Profits)

Over a period of time. Image
Management teams have leeway in categorizing their income statement.

This means that not all income statements look the same.

Here is a typical layout and the meaning of the most commonly used terms: Image
Read 11 tweets
Aug 26
Financial Statements For Beginners

Want to learn accounting?

Study these 9 simple infographics (a visual thread) โ†“ Image
Image
Financial Statements DO NOT have a universal layout

Here are some other balance sheet terms you might see: Image
Read 9 tweets

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