100x stock
 |
Description
Book Introduction
The Ultimate Stock Investment Guide from Top Analysts
Amazon, Pepsi, Gillette, Monster Beverage.
These are the best stocks in name and reality, with prices increasing more than 100-fold since listing.
Imagine if you had found and held these stocks early on.
Even if you invest just 5 million won, you can make 500 million won.
But considering the reality that even the best fund managers struggle to achieve returns exceeding 10%, this sounds like a pipe dream.
To make that dream a reality, the author of this book, Christopher Mayer, studied stocks that increased 100-fold in the United States from 1962 to 2014.
And that research was organized into an investment strategy and compiled into this book.
By following fascinating real-world examples and excellent analysis, you'll naturally discover what the best stocks have in common and how to invest once you find them.
Contrary to the unrealistic and sensational expression "100-fold stock," you'll discover that this is a truly practical investment strategy that everyone from ordinary office workers preparing for retirement to professional investors can benefit from.
Above all, the Korean edition's preface and interviews with Korean readers provide a more concrete idea of how Koreans can digest the author's 100-fold stock strategy.
And you can also think about the characteristics of Korean 100-bagger stocks through the list of Korean 100-bagger stocks provided as an appendix.
Amazon, Pepsi, Gillette, Monster Beverage.
These are the best stocks in name and reality, with prices increasing more than 100-fold since listing.
Imagine if you had found and held these stocks early on.
Even if you invest just 5 million won, you can make 500 million won.
But considering the reality that even the best fund managers struggle to achieve returns exceeding 10%, this sounds like a pipe dream.
To make that dream a reality, the author of this book, Christopher Mayer, studied stocks that increased 100-fold in the United States from 1962 to 2014.
And that research was organized into an investment strategy and compiled into this book.
By following fascinating real-world examples and excellent analysis, you'll naturally discover what the best stocks have in common and how to invest once you find them.
Contrary to the unrealistic and sensational expression "100-fold stock," you'll discover that this is a truly practical investment strategy that everyone from ordinary office workers preparing for retirement to professional investors can benefit from.
Above all, the Korean edition's preface and interviews with Korean readers provide a more concrete idea of how Koreans can digest the author's 100-fold stock strategy.
And you can also think about the characteristics of Korean 100-bagger stocks through the list of Korean 100-bagger stocks provided as an appendix.
- You can preview some of the book's contents.
Preview
index
Translator's Preface 11
Chapter 1: What is a 100-Bagger Stock? 15
The problem is soon an investment opportunity 18
Picking Up Where Phelps Left Off 25
Chapter 2 Anyone Can Do It 27
365 Stocks That Turned $10,000 into $1 Million 29
Chapter 3: Coffee Can Portfolio 37
Extreme Coffee Can Portfolio 41
The 50 Biggest Obstacles to 100x Investment
52 Coffee Cans to Prepare for a Catastrophe
Footnote 57 on the Coffee Can Portfolio
Chapter 4: The 100-Billion Stock Rule 61
Tony's 100-Billion Stock 62
Micro-Caps and 100-Bagger Stocks 66
The Alchemy of 100-Bottom Stocks 67
Martelli's 10x Stock 71
Heizer's Profit Stairs 72
Chapter 5: 100-Bagger Stocks of the Past 50 Years 77
Real Cases 85
Summary 121
Chapter 6: The Key to 100-Billion Stocks 123
Finding 100-Percentage-Yield Stocks Among High ROE Stocks 127
Chapter 7: How Should We View Owner-Managers? 135
Betting on a Millionaire 140
Wealth begets wealth 148
Chapter 8: Outsiders: The Best CEOs 151
Next Outsider 158
Chapter 9: The Secret of the 18,000-Billion-Funded Stock 165
Berkshire Hathaway 170 in the Next 20 Years
Chapter 10: How Much Should You Invest? 175
Kelly's descendants? 180
Chapter 11: Acquiring Treasury Stock: Accelerating Returns 183
Acquiring Treasury Stock: A Modern-Day Tontine 186
Chapter 12: Driving Out Competitors 191
Mother Goddess's Thoughts on the Moat 198
Overcoming Mean Reversion 200
Chapter 13: Various Psychological Conditions Regarding 100-Billion Stocks 205
Don't Chase Profits 207
Don't be bored 212
Don't Be Fooled: Avoid Scams 217
Precautions 223
Ignore the Forecasters 224
231 Things I've Learned from Writing Newsletters for Over 10 Years
100-Bagger Stocks and More Stories 234
What about failed stocks? 242
Chapter 14: What If the Next Great Depression Comes? 243
Marty Whitman: The Market's Recovery 245
Learn How to Buy and Hold Right from a Renowned Economist 247
Floyd Odlum: Getting the Best Out of Challenging Times 255
A Wall Street Trader's Memories of the Great Depression 257
John Dix: Avoid Debt 261
Conclusion: 100-Billion Stock Summary 265
Key Principles for Finding 100-Bagger Stocks 271
In closing: There is no magic formula 299
Appendix 300 Korean 100-Bagger Stocks
Summary 301
Ranking list by category 304
Search 340
Chapter 1: What is a 100-Bagger Stock? 15
The problem is soon an investment opportunity 18
Picking Up Where Phelps Left Off 25
Chapter 2 Anyone Can Do It 27
365 Stocks That Turned $10,000 into $1 Million 29
Chapter 3: Coffee Can Portfolio 37
Extreme Coffee Can Portfolio 41
The 50 Biggest Obstacles to 100x Investment
52 Coffee Cans to Prepare for a Catastrophe
Footnote 57 on the Coffee Can Portfolio
Chapter 4: The 100-Billion Stock Rule 61
Tony's 100-Billion Stock 62
Micro-Caps and 100-Bagger Stocks 66
The Alchemy of 100-Bottom Stocks 67
Martelli's 10x Stock 71
Heizer's Profit Stairs 72
Chapter 5: 100-Bagger Stocks of the Past 50 Years 77
Real Cases 85
Summary 121
Chapter 6: The Key to 100-Billion Stocks 123
Finding 100-Percentage-Yield Stocks Among High ROE Stocks 127
Chapter 7: How Should We View Owner-Managers? 135
Betting on a Millionaire 140
Wealth begets wealth 148
Chapter 8: Outsiders: The Best CEOs 151
Next Outsider 158
Chapter 9: The Secret of the 18,000-Billion-Funded Stock 165
Berkshire Hathaway 170 in the Next 20 Years
Chapter 10: How Much Should You Invest? 175
Kelly's descendants? 180
Chapter 11: Acquiring Treasury Stock: Accelerating Returns 183
Acquiring Treasury Stock: A Modern-Day Tontine 186
Chapter 12: Driving Out Competitors 191
Mother Goddess's Thoughts on the Moat 198
Overcoming Mean Reversion 200
Chapter 13: Various Psychological Conditions Regarding 100-Billion Stocks 205
Don't Chase Profits 207
Don't be bored 212
Don't Be Fooled: Avoid Scams 217
Precautions 223
Ignore the Forecasters 224
231 Things I've Learned from Writing Newsletters for Over 10 Years
100-Bagger Stocks and More Stories 234
What about failed stocks? 242
Chapter 14: What If the Next Great Depression Comes? 243
Marty Whitman: The Market's Recovery 245
Learn How to Buy and Hold Right from a Renowned Economist 247
Floyd Odlum: Getting the Best Out of Challenging Times 255
A Wall Street Trader's Memories of the Great Depression 257
John Dix: Avoid Debt 261
Conclusion: 100-Billion Stock Summary 265
Key Principles for Finding 100-Bagger Stocks 271
In closing: There is no magic formula 299
Appendix 300 Korean 100-Bagger Stocks
Summary 301
Ranking list by category 304
Search 340
Detailed image
Into the book
“One of the fundamental principles of investing is never to invest for any other reason than to invest,” Phelps advises.
Don't sell stocks because their prices are fluctuating or because you want to realize capital gains to offset other losses.
There are rare times when you have to sell, and that's when it becomes clear you've made a mistake.
According to Phelps, every sale is a confession of a mistake.
And the shorter the period of time you've held a stock, the bigger the mistake you've made when buying it.
--- p.23
In golf, even a slight change in how you hold the club and your posture can help you hit the ball much better.
Just by placing a little more emphasis on buying with the intention of holding and being a little more determined not to be tempted to sell, your portfolio will be much richer.
In Alice in Wonderland, there is a saying that if you want to stay in the same place, you have to run fast.
Based on my experience, in the stock market, you have to hold your ground firmly to move quickly.
--- p.25
It was interesting to discover that we had been secretly following the portfolio we had recommended to our wives.
And then I saw the size of the assets, and it was shocking.
My husband added his own twist to our advice.
He ignored the sell recommendation.
Instead, I invested about $5,000 in each stock that I recommended to buy.
Then he put the stock certificates in the safe and forgot about them.
Let's do this and something wonderful happens.
His portfolio contained quite a few doomed stocks that had fallen to around $2,000 in value.
It wasn't that big of a deal.
Instead, several stocks rose to $100,000.
But the real twist is this.
The husband owned a huge stock holding, worth $800,000, which was more than the value of his wife's entire portfolio.
“It started with a small investment in a company called Haloid, which later turned into a huge stake in a company called Xerox,” Kirby wrote.
--- p.39~40
In 1962, Tiny Wilkinson Sword of London launched a range of stainless steel blades with great success.
Users claimed that the product gave them at least 12 smooth shaves, while Gillette's carbon steel blades only gave them 3-4.
Wilkinson's razor could have seriously affected Gillette's dominant position.
However, Gillette researchers had already patented the stainless steel coating process before Wilkinson obtained the patent.
So Gillette charged a royalty for each stainless steel blade Wilkinson sold.
This made things difficult for Wilkinson.
In 1963, a year after the so-called 'Wilkinson Shock' incident, Gillette launched its own stainless steel razor blade.
Gillette set its prices lower than Wilkinson and other U.S. competitors.
By doing so, it regained its original market position and, a few years later, launched a series of razor blades with improved performance.
Gillette is a great company.
It was so in the past, it is so now, and it will be so in the future.
--- p.116~117
Such stocks become 100-fold stocks in 20 or 30 years.
Such businesses can be found.
It is a small business with high ROE and relatively clear growth potential.
If a company has shown a high ROE for four or five consecutive years, and achieved this through high profitability rather than debt, that's a good company to start looking into.
--- p.129
I think this is a more important factor for the companies included in the wealth index.
The people who run these companies have control.
So when we experience a downturn similar to 2008, they take on more debt and spend more cash.
Because the opportunity is significant.
“This is the moment to spend money, this is the moment to invest.” That’s what I think.
Compare this behavior to a company run by agents.
They are averse to spending cash or taking on debt in a highly volatile environment.
Agents--- p. Managers are very fearful of what the public and executives think of them, and they are also very concerned about how this will affect their careers.
They just want to keep sitting on piles of cash.
It's such a self-evident fact.
--- p.143
As Buffett says, reject the Noah's Ark approach to investing.
As many great investors do.
That's what I try to do in my own portfolio.
Keep your investment list relatively short and focus on the best ideas.
When the stock you own increases by 100 times, shouldn't it have meaning?
--- p.181~182
If done well, stock acquisitions can accelerate the compounding effect of your profits.
Acquiring one's own stock has only become more common relatively recently.
That's why it's not a very common strategy in my 100-bagger stock research, which covers the period from 1962 to 2014.
But companies that consistently bought back their own stock produced surprising results, as we saw in Chapter 8, which discussed outsiders.
Acquiring your own stock is one of the keys to reaching a 100-fold stock price.
If you find a company that has been reducing its number of listed shares over time and that tends to buy back its own shares at low prices, it's worth taking a closer look.
Because you might have discovered a 100x stock candidate.
--- p.190
In general, a slump is an experience that must be endured and survived with as much composure and patience as possible.
The reason this experience can be beneficial is because individual stocks move more independently of other stocks than when you move in and out of the stock market in bulk.
Investors should not be deterred by these facts and change their investment attitudes.
If this thinking worked during the Great Depression, it will work for whatever happens from now on.
--- p.225
There are always countless opportunities in every market.
There are always! Graham said there were over 5,000 publicly traded stocks in 1976 (today, that number is more than three times that, considering international markets).
He then said the following:
Investors can always find opportunities to buy attractive stocks that suit their various approaches and preferences.
Such stocks account for at least 1 percent of the total number of stocks (approximately 30 stocks).
This is true.
Saying there is nothing to buy in the market means you didn't look hard enough.
--- p.230
Phelps believes that when you make a mistake, you should sell your stock.
And again, all great investors don't define a mistake as simply a stock price going down (in fact, they might consider profit-taking in a bull market a mistake).
Because you are missing out on opportunities to make bigger profits.
Plus, you pay taxes on capital gains).
Don't sell stocks because their prices are fluctuating or because you want to realize capital gains to offset other losses.
There are rare times when you have to sell, and that's when it becomes clear you've made a mistake.
According to Phelps, every sale is a confession of a mistake.
And the shorter the period of time you've held a stock, the bigger the mistake you've made when buying it.
--- p.23
In golf, even a slight change in how you hold the club and your posture can help you hit the ball much better.
Just by placing a little more emphasis on buying with the intention of holding and being a little more determined not to be tempted to sell, your portfolio will be much richer.
In Alice in Wonderland, there is a saying that if you want to stay in the same place, you have to run fast.
Based on my experience, in the stock market, you have to hold your ground firmly to move quickly.
--- p.25
It was interesting to discover that we had been secretly following the portfolio we had recommended to our wives.
And then I saw the size of the assets, and it was shocking.
My husband added his own twist to our advice.
He ignored the sell recommendation.
Instead, I invested about $5,000 in each stock that I recommended to buy.
Then he put the stock certificates in the safe and forgot about them.
Let's do this and something wonderful happens.
His portfolio contained quite a few doomed stocks that had fallen to around $2,000 in value.
It wasn't that big of a deal.
Instead, several stocks rose to $100,000.
But the real twist is this.
The husband owned a huge stock holding, worth $800,000, which was more than the value of his wife's entire portfolio.
“It started with a small investment in a company called Haloid, which later turned into a huge stake in a company called Xerox,” Kirby wrote.
--- p.39~40
In 1962, Tiny Wilkinson Sword of London launched a range of stainless steel blades with great success.
Users claimed that the product gave them at least 12 smooth shaves, while Gillette's carbon steel blades only gave them 3-4.
Wilkinson's razor could have seriously affected Gillette's dominant position.
However, Gillette researchers had already patented the stainless steel coating process before Wilkinson obtained the patent.
So Gillette charged a royalty for each stainless steel blade Wilkinson sold.
This made things difficult for Wilkinson.
In 1963, a year after the so-called 'Wilkinson Shock' incident, Gillette launched its own stainless steel razor blade.
Gillette set its prices lower than Wilkinson and other U.S. competitors.
By doing so, it regained its original market position and, a few years later, launched a series of razor blades with improved performance.
Gillette is a great company.
It was so in the past, it is so now, and it will be so in the future.
--- p.116~117
Such stocks become 100-fold stocks in 20 or 30 years.
Such businesses can be found.
It is a small business with high ROE and relatively clear growth potential.
If a company has shown a high ROE for four or five consecutive years, and achieved this through high profitability rather than debt, that's a good company to start looking into.
--- p.129
I think this is a more important factor for the companies included in the wealth index.
The people who run these companies have control.
So when we experience a downturn similar to 2008, they take on more debt and spend more cash.
Because the opportunity is significant.
“This is the moment to spend money, this is the moment to invest.” That’s what I think.
Compare this behavior to a company run by agents.
They are averse to spending cash or taking on debt in a highly volatile environment.
Agents--- p. Managers are very fearful of what the public and executives think of them, and they are also very concerned about how this will affect their careers.
They just want to keep sitting on piles of cash.
It's such a self-evident fact.
--- p.143
As Buffett says, reject the Noah's Ark approach to investing.
As many great investors do.
That's what I try to do in my own portfolio.
Keep your investment list relatively short and focus on the best ideas.
When the stock you own increases by 100 times, shouldn't it have meaning?
--- p.181~182
If done well, stock acquisitions can accelerate the compounding effect of your profits.
Acquiring one's own stock has only become more common relatively recently.
That's why it's not a very common strategy in my 100-bagger stock research, which covers the period from 1962 to 2014.
But companies that consistently bought back their own stock produced surprising results, as we saw in Chapter 8, which discussed outsiders.
Acquiring your own stock is one of the keys to reaching a 100-fold stock price.
If you find a company that has been reducing its number of listed shares over time and that tends to buy back its own shares at low prices, it's worth taking a closer look.
Because you might have discovered a 100x stock candidate.
--- p.190
In general, a slump is an experience that must be endured and survived with as much composure and patience as possible.
The reason this experience can be beneficial is because individual stocks move more independently of other stocks than when you move in and out of the stock market in bulk.
Investors should not be deterred by these facts and change their investment attitudes.
If this thinking worked during the Great Depression, it will work for whatever happens from now on.
--- p.225
There are always countless opportunities in every market.
There are always! Graham said there were over 5,000 publicly traded stocks in 1976 (today, that number is more than three times that, considering international markets).
He then said the following:
Investors can always find opportunities to buy attractive stocks that suit their various approaches and preferences.
Such stocks account for at least 1 percent of the total number of stocks (approximately 30 stocks).
This is true.
Saying there is nothing to buy in the market means you didn't look hard enough.
--- p.230
Phelps believes that when you make a mistake, you should sell your stock.
And again, all great investors don't define a mistake as simply a stock price going down (in fact, they might consider profit-taking in a bull market a mistake).
Because you are missing out on opportunities to make bigger profits.
Plus, you pay taxes on capital gains).
--- p.296
Publisher's Review
Lessons from Reply 1988
Among the popular dramas that brought back memories in 2015, [Reply 1988], there is a scene that surprisingly gives us something to think about about stocks.
This is a scene where the townspeople are debating how to manage the 50 million won prize money that Choi Taek, a Go prodigy, received.
At this time, Jeong-hwan's father, Kim Seong-gyun, recommends investing in stocks, saying that his friend told him to buy stocks in Samsung Electronics, Hanmi Pharmaceutical, and Pacific Chemical. Seong Dong-il laughs at this and strongly insists that the stock prices have risen so much that he should save them in the bank.
The interest rate at that time was 15%.
The reason this scene is funny is because we know the future.
Contrary to Sung Dong-il's boasts, bank interest rates have continued to fall since then, while Samsung Electronics, Hanmi Pharmaceutical, and Pacific Chemical (now Amorepacific) are the strongest stocks that anyone who bought them back then and held onto them until now would have envied.
If Choi Taek had used his 50 million won prize money to buy Samsung Electronics stocks, it would have been worth about 3.3 billion won in 2015, a whopping 66 times the value.
If you watch the drama, you can see that the Eunma Apartment was worth 50 million won at the time, so if you bought it, it would be worth about 1.1 billion won.
Contrary to our perception that 'real estate is the best', stocks were the most profitable investment.
But even if we know these facts, it is difficult to readily choose to invest in stocks.
Because it is difficult to know what will happen to the stocks of Samsung Electronics, Hanmi Pharmaceutical, and Pacific Chemical at that time.
But what if there was a way to increase your chances of finding stocks like Samsung Electronics while they're still cheap? What if the lessons of "Reply 1988" could be turned into a systematic investment strategy? "100-Bag Stock" is just that book.
Author Christopher Mayer analyzes 365 U.S. stocks that increased 100-fold between 1962 and 2014, presenting a reasonable investment strategy that is still viable today.
The Secrets of the Strongest Stocks at a Glance
There are two key elements to Mayer's proposed 100-fold stock investment strategy, one of which is 'time.'
In [Reply 1988], Samsung Electronics stocks increased 66-fold after 27 years.
The reason why picking good stocks is the most powerful investment strategy is because of the power of compound interest, which only works properly over time.
If you hold a stock with a 20 percent return for 25 years, it will increase 100-fold.
However, if you hold it for 20 years, it is 40 times less than the opposite.
Truly high returns can only be achieved by suppressing the desire to buy and sell stocks according to changing circumstances.
But as we all know, this is not an easy task.
When stocks start to fall, I get anxious, and when stocks start to rise, I get greedy.
However, as Warren Buffett said, you can only invest in stocks 20 times in your lifetime, so the author says to trust and wait for carefully selected stocks.
The other one is, quite obviously, ‘growth.’
Not normal growth, but rapid and powerful growth.
There are two conditions here, one is a 'low price-to-earnings ratio'.
In other words, the stock price should not be too expensive.
It's unreasonable to buy Apple or IBM stock now and expect it to grow dozens of times.
But that doesn't mean you should buy tiny micro-cap stocks.
You can find plenty of good information by choosing a company that has enough information to understand its status.
The median sales of the 100-bagger stocks analyzed by the author was about $17 million, meaning they were companies of a certain size.
So, what should you pay attention to when choosing stocks? While you should consult various data, including financial statements, the author argues that there are two key factors to consider.
One is the manager and the other is the economic moat.
Managers must pay attention to what business strategy they have and how they are pursuing that strategy.
In other words, we need to see a vision that is difficult to grasp through financial statements.
And he says to pay attention to companies where the owner-manager, or executive, owns a large stake.
Because the incentive to grow the company is much stronger.
An economic moat refers to a company's unique competitive edge that other companies find difficult to match.
It could be a patent or know-how for a core technology, or it could be a price.
The forms vary, but what matters is whether there is an element that can dominate a market, whether narrow or broad.
Solid case studies you won't find anywhere else
In the process of telling this story, the author does not overuse abstract concepts.
We also provide detailed analysis of the best stocks that everyone should know.
We share detailed analyses of Monster Beverage, which any stock investor would have heard of; Amazon, one of the largest companies in terms of sales; Pepsi, which can be found everywhere in the world; EA, a sports game company; Gillette, a razor company; and Comcast, which is unfamiliar to us but has quickly risen to become the best cable company in the United States.
This will give us a clearer picture of the abstract criteria introduced above.
These analyses provide several insights.
In Amazon's case, the stock price wasn't that expensive until a certain point.
Because the operating profit margin was not high.
But anyone who looked closely at that low operating profit margin could easily buy Amazon's stock at a good price.
This is because the low operating profit margin was due to high R&D, or research and development, expenses.
It wouldn't have been difficult to predict that the Internet consumer market would grow significantly in 1998, so it's only natural that we should pay attention to companies that are investing heavily in research and development to build competitive systems with that market in mind.
The case of Monster Beverage is similar.
How did Monster Beverage succeed in the fiercely competitive beverage market? Management decisions were crucial.
Hilton and Rodney, who purchased Hansen, the predecessor of Monster Beverage, reduced the number of products and invested heavily in branding and distribution.
This is because we realized how important it is to secure brand power through distribution and marketing in the beverage market through our failure to give up market share to Red Bull.
Anyone who bought Monster Beverage in 2004 after observing and trusting the managers' vision and strategy would have made 188 times their investment.
Gillette's case is a case that shows how strongly the stock of a company that has secured an economic moat through investment in core technologies and securing patents can grow. EA's case also shows that the treatment of programmers, who are at the heart of game development, and the company culture are also factors that deserve attention.
Investment Strategies to Survive Recessions and Low Growth
The author's proposed 100-fold stock strategy might seem unrealistic in today's times when the overall economy is not experiencing high growth.
It was the era of [Reply 1988], so Samsung Electronics, Hanmi Pharmaceutical, and Pacific Chemical were possible, but now you might think it's impossible.
But as we saw earlier, Monster Beverage has been a 100-bagger since 2004.
This was also the case in the soft drink market, which could be considered saturated.
Amazon has achieved rapid growth through its leading technological prowess in a market opened up by technological advancements.
Even in times of recession and low growth, technological advancements occur, markets change, and innovations emerge.
Rather, in such times, undervalued stocks emerge and fierce efforts are made to overcome the crisis.
Buying and selling stocks on a whim is actually riskier in today's economic environment.
Because the more frequently you trade stocks, the more likely you are to make incorrect decisions based on market conditions.
The worse the market conditions, the more likely it is that companies with high potential, based on vision or technological prowess, will be found, and the more likely they are to deliver higher returns, even if they lack adequate capital.
Of course, following the criteria presented by the author does not guarantee that you will find 100-bagger stocks.
There is always risk in stocks.
However, if you know the criteria for good stocks and use them to select stocks and hold them for a long time, there is a high possibility that one or two of them will grow enough to compensate for the failures of the rest.
Among the popular dramas that brought back memories in 2015, [Reply 1988], there is a scene that surprisingly gives us something to think about about stocks.
This is a scene where the townspeople are debating how to manage the 50 million won prize money that Choi Taek, a Go prodigy, received.
At this time, Jeong-hwan's father, Kim Seong-gyun, recommends investing in stocks, saying that his friend told him to buy stocks in Samsung Electronics, Hanmi Pharmaceutical, and Pacific Chemical. Seong Dong-il laughs at this and strongly insists that the stock prices have risen so much that he should save them in the bank.
The interest rate at that time was 15%.
The reason this scene is funny is because we know the future.
Contrary to Sung Dong-il's boasts, bank interest rates have continued to fall since then, while Samsung Electronics, Hanmi Pharmaceutical, and Pacific Chemical (now Amorepacific) are the strongest stocks that anyone who bought them back then and held onto them until now would have envied.
If Choi Taek had used his 50 million won prize money to buy Samsung Electronics stocks, it would have been worth about 3.3 billion won in 2015, a whopping 66 times the value.
If you watch the drama, you can see that the Eunma Apartment was worth 50 million won at the time, so if you bought it, it would be worth about 1.1 billion won.
Contrary to our perception that 'real estate is the best', stocks were the most profitable investment.
But even if we know these facts, it is difficult to readily choose to invest in stocks.
Because it is difficult to know what will happen to the stocks of Samsung Electronics, Hanmi Pharmaceutical, and Pacific Chemical at that time.
But what if there was a way to increase your chances of finding stocks like Samsung Electronics while they're still cheap? What if the lessons of "Reply 1988" could be turned into a systematic investment strategy? "100-Bag Stock" is just that book.
Author Christopher Mayer analyzes 365 U.S. stocks that increased 100-fold between 1962 and 2014, presenting a reasonable investment strategy that is still viable today.
The Secrets of the Strongest Stocks at a Glance
There are two key elements to Mayer's proposed 100-fold stock investment strategy, one of which is 'time.'
In [Reply 1988], Samsung Electronics stocks increased 66-fold after 27 years.
The reason why picking good stocks is the most powerful investment strategy is because of the power of compound interest, which only works properly over time.
If you hold a stock with a 20 percent return for 25 years, it will increase 100-fold.
However, if you hold it for 20 years, it is 40 times less than the opposite.
Truly high returns can only be achieved by suppressing the desire to buy and sell stocks according to changing circumstances.
But as we all know, this is not an easy task.
When stocks start to fall, I get anxious, and when stocks start to rise, I get greedy.
However, as Warren Buffett said, you can only invest in stocks 20 times in your lifetime, so the author says to trust and wait for carefully selected stocks.
The other one is, quite obviously, ‘growth.’
Not normal growth, but rapid and powerful growth.
There are two conditions here, one is a 'low price-to-earnings ratio'.
In other words, the stock price should not be too expensive.
It's unreasonable to buy Apple or IBM stock now and expect it to grow dozens of times.
But that doesn't mean you should buy tiny micro-cap stocks.
You can find plenty of good information by choosing a company that has enough information to understand its status.
The median sales of the 100-bagger stocks analyzed by the author was about $17 million, meaning they were companies of a certain size.
So, what should you pay attention to when choosing stocks? While you should consult various data, including financial statements, the author argues that there are two key factors to consider.
One is the manager and the other is the economic moat.
Managers must pay attention to what business strategy they have and how they are pursuing that strategy.
In other words, we need to see a vision that is difficult to grasp through financial statements.
And he says to pay attention to companies where the owner-manager, or executive, owns a large stake.
Because the incentive to grow the company is much stronger.
An economic moat refers to a company's unique competitive edge that other companies find difficult to match.
It could be a patent or know-how for a core technology, or it could be a price.
The forms vary, but what matters is whether there is an element that can dominate a market, whether narrow or broad.
Solid case studies you won't find anywhere else
In the process of telling this story, the author does not overuse abstract concepts.
We also provide detailed analysis of the best stocks that everyone should know.
We share detailed analyses of Monster Beverage, which any stock investor would have heard of; Amazon, one of the largest companies in terms of sales; Pepsi, which can be found everywhere in the world; EA, a sports game company; Gillette, a razor company; and Comcast, which is unfamiliar to us but has quickly risen to become the best cable company in the United States.
This will give us a clearer picture of the abstract criteria introduced above.
These analyses provide several insights.
In Amazon's case, the stock price wasn't that expensive until a certain point.
Because the operating profit margin was not high.
But anyone who looked closely at that low operating profit margin could easily buy Amazon's stock at a good price.
This is because the low operating profit margin was due to high R&D, or research and development, expenses.
It wouldn't have been difficult to predict that the Internet consumer market would grow significantly in 1998, so it's only natural that we should pay attention to companies that are investing heavily in research and development to build competitive systems with that market in mind.
The case of Monster Beverage is similar.
How did Monster Beverage succeed in the fiercely competitive beverage market? Management decisions were crucial.
Hilton and Rodney, who purchased Hansen, the predecessor of Monster Beverage, reduced the number of products and invested heavily in branding and distribution.
This is because we realized how important it is to secure brand power through distribution and marketing in the beverage market through our failure to give up market share to Red Bull.
Anyone who bought Monster Beverage in 2004 after observing and trusting the managers' vision and strategy would have made 188 times their investment.
Gillette's case is a case that shows how strongly the stock of a company that has secured an economic moat through investment in core technologies and securing patents can grow. EA's case also shows that the treatment of programmers, who are at the heart of game development, and the company culture are also factors that deserve attention.
Investment Strategies to Survive Recessions and Low Growth
The author's proposed 100-fold stock strategy might seem unrealistic in today's times when the overall economy is not experiencing high growth.
It was the era of [Reply 1988], so Samsung Electronics, Hanmi Pharmaceutical, and Pacific Chemical were possible, but now you might think it's impossible.
But as we saw earlier, Monster Beverage has been a 100-bagger since 2004.
This was also the case in the soft drink market, which could be considered saturated.
Amazon has achieved rapid growth through its leading technological prowess in a market opened up by technological advancements.
Even in times of recession and low growth, technological advancements occur, markets change, and innovations emerge.
Rather, in such times, undervalued stocks emerge and fierce efforts are made to overcome the crisis.
Buying and selling stocks on a whim is actually riskier in today's economic environment.
Because the more frequently you trade stocks, the more likely you are to make incorrect decisions based on market conditions.
The worse the market conditions, the more likely it is that companies with high potential, based on vision or technological prowess, will be found, and the more likely they are to deliver higher returns, even if they lack adequate capital.
Of course, following the criteria presented by the author does not guarantee that you will find 100-bagger stocks.
There is always risk in stocks.
However, if you know the criteria for good stocks and use them to select stocks and hold them for a long time, there is a high possibility that one or two of them will grow enough to compensate for the failures of the rest.
GOODS SPECIFICS
- Date of issue: July 2, 2020
- Page count, weight, size: 360 pages | 514g | 152*225*30mm
- ISBN13: 9791196159023
- ISBN10: 1196159025
You may also like
카테고리
korean
korean
![ELLE 엘르 스페셜 에디션 A형 : 12월 [2025]](http://librairie.coreenne.fr/cdn/shop/files/b8e27a3de6c9538896439686c6b0e8fb.jpg?v=1766436872&width=3840)
