Where I Look For Public Equity Investment Opportunities

Investing can be fun, it can also be boring. I think a lot of people don't understand that investing involves a lot of plugging away looking for opportunities, which is boring. Looking through a universe of companies for a few good opportunities can be really effective, but it's a full time job. I no longer look at hundreds of companies to find one I like, I don't think it makes sense for my personal account. Instead, I have a few different places I look for opportunities.


One more thing, if you are an amateur investor these spruces might do you more harm than good, so be mindful.


The first place I look is the value investors club website. VIC was founded by Joel Greenblatt and will allow you access to high quality investment ideas for free, though unless you earn] a full membership you will see ideas at a delay. Many of the contributors on VIC are real deal successful investors, some of which are even famous. You wont be able to tell who is who because you don't use your real name on that site. I find good ideas though VIC on a fairly regular basis, at least 2 a year.


The second place I look is at companies I know. If you have already looked at a company once it becomes much easier to circle back and see if it is mispriced. Usually within 10-15 minutes I'll know if I want to dig into something further or move on. I'd recommend picking a universe of stocks which is likely to be mispriced and read one or two company descriptions a day so that you can familiarize yourself with a small set of companies.


Seeking Alpha is a community sourced equity research site, it costs somewhere between $20 and $35 a month for a membership. Unlike most investing communities the content here is curated. For example, the writer submits a piece of equity research to the Seeking Alpha team, the editors will give some feedback and if the research is of a high enough quality it may be published, and the author can be paid. You should focus on finding writers you like and following what they out out.


I also get some recommendations from friends an acquaintances. This one will depend on a lot on what your social circle looks like. I've got some good ideas this way but unless you have a specific type of social circle recommendations from your network are probably more harmful than helpful.


Finally, I should mention that no matter how you source investments it's also important to think about where you want to actively look. I'm focused on North American small caps because I feel they are the most likely to be mispriced. I also stay away from a lot of small stocks which require specialized knowledge (biotech for example). I find that I'm much more likely to be successful is simpler businesses, retail and food services for example.


So, if you want to try and pick stocks it is probably wise to pick an area you think has a high likelihood of being mispriced and find some idea sources that don't require you to sift through companies all day. If you take that approach I think your odds of success go up.