Tony Kynaston started investing in the stock market 30 years ago and developed a simple checklist methodology (by studying people like Warren Buffett) that allowed him to retire from his corporate career at age 43 and become a professional investor. And he’s done pretty well since then. The average return on his portfolio over the last 20 years has been 19.5% per annum – double the ASX index.
QAV stands for QUALITY AT VALUE. Tony's approach is to use a checklist to find companies that are performing well (quality) but which can also be bought at a discount (value). It's basically what is usually called "value investing".
Tony joined me on Shares for Beginners to give an overview of his methodology. He has a checklist that helps him determine what shares he will invest. It's all based on publicly available knowledge from company data and on-line tools like Yahoo finance, with a little bit of help from a couple of subscription services.
Tony started investing in shares with a bunch of mates and no clear strategy for making money. It wasn't until he read Buffett - The Making of an American Capitalist that the penny dropped. He combined Buffett's valuation methodology with another book - The Checklist Manifesto which was written by a doctor who noticed that airline safety depended on pilots having a checklist which was strictly adhered to before any flight took off.
This is the basis of the QAV philosophy - a checklist and a clear-eyed view of the numbers that matter in valuing a share.
We talked about:
Tony is a great guy and I hope you learn as much as I did in this interview
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