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The Zulu Principle: Making extraordinary profits from ordinary shares (Harriman Modern Classics)
 
 

The Zulu Principle: Making extraordinary profits from ordinary shares (Harriman Modern Classics) [Kindle Edition]

Jim Slater
3.9 out of 5 stars  See all reviews (10 customer reviews)

Digital List Price: £13.43 What's this?
Print List Price: £25.00
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Product Description

Ivan Fallon, Sunday Times

The single most powerful influence on the business scene.....Jim Slater has refined, honed and distilled his investment thoughts into a book that is vintage Slater: innovative, imaginative, original and fresh with sophisticated investment methods made to seem simple and glaringly obvious - if only you'd thought of them before.

Lord Hanson

For anyone seriously interested in investment, this book is essential reading. I recommend it strongly.

Product details

  • Format: Kindle Edition
  • File Size: 2446 KB
  • Print Length: 224 pages
  • Publisher: Harriman House (14 Dec 2010)
  • Sold by: Amazon Media EU S.à r.l.
  • Language English
  • ASIN: B004G8QHOU
  • Text-to-Speech: Enabled
  • Average Customer Review: 3.9 out of 5 stars  See all reviews (10 customer reviews)
  • Amazon Bestsellers Rank: #79,389 Paid in Kindle Store (See Top 100 Paid in Kindle Store)
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Customer Reviews

Most Helpful Customer Reviews
10 of 10 people found the following review helpful
By Brett H TOP 50 REVIEWER
Format:Hardcover
I first read the Zulu Principle some years ago and it had a profound effect on my investing habits. The new edition is a very limited update so probably not worth investing in if you have the first edition.

The idea behind it is that small company shares are often underresearched - its not worth an analyst in a major investment firm spending a long time analysing a company with a market value, of, say £10m since even if it proves to be the bargain of the century it will not be possible for his company to build up a worthwhile holding as there will be so few shares around. The name of the book comes from some research done by Jim Slater's wife on Zulus. She started off by reading a small article and already knew more than most people on Zulus. If she had borrowed all the books in her local library she would probably have known more about Zulus than most people in Surrey. If she had then decided to visit South Africa and do further study at the University she would probably be in the handful of experts on Zulus in the UK and possibly the world. The idea being that with small company shares, they are often so underresearched that even if you do a limited amount of digging on a particular company you will soon know more than most others.

With this premise, Jim Slater then sets off to explain how to find growth stocks which are undervalued by his definition. He is looking for shares which have shown growth over a number of years and look like they will continue to do so, and which the market is not fully appreciating price wise. A limited amount of accounting understanding is assumed, but his methods are generally straight forward and remarkably sensible.

Jim Slater has been a outstandingly successful investor over a number of years, and in this book shows that there is no rocket science involved. This really is a must read, but keep in mind that his methods work better in a bull (rising) market.
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3 of 3 people found the following review helpful
By Andy
Format:Hardcover
Some of the lessons in this book are timeless, being as relevant now as they were when Mr Slater wrote this book in 1992. Perhaps the "big thing" in this book is the concept of the "PEG ratio", which was new to most UK investors at the time. He reviews several different styles of investing, at least some of which now appear very much a feature of their time.

The only update that's been made since 1992, as far as I can see, is in the "further reading" section, where we're referred to a popular investment-book website. It's such a surprise to see a 21st C. artefact in this emphatically 20th C book that I stopped and stared at it for a minute, checking in my memory for recollections of web commerce in those distant days (no, that couldn't have been in the original edition).

So much of this book - far too much - is of interest only to historians. There really should have been a warning to the near-novice (for whom this book was originally written) not to waste time in 2010 looking for the "Unlisted Securities Market"; and don't call your broker asking to be sent a copy of the "Datastream relative-strength chart", or any of the other stuff in the "Your Broker and You" chapter: they'll think you've just stepped out of a time warp.

Overall, I was quite disappointed by this, and glad that I hadn't shelled out the £25 cover price to buy it.
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15 of 17 people found the following review helpful
Format:Hardcover
I am really disappointed to buy this book as a "brand new edition", only to find that the only thing brand new about it is a 3 page preface. The rest of the book is stuck in 1992, and takes examples from companies like Farepak, GEC and Polly Peck, none of whom should inspire much confidence in a new investor. Also, there is no mention of trading in the modern world, this was a pre internet book, in the days when you had to buy paper copies of information about companies from your broker.

While I would have had no problem buying this book as an aging guide to share trading, indeed, the underlying principles are still, in the main, valid, I do object to what amounts to a lazy reissue.
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Popular Highlights

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&quote;
Strong cash flow well in excess of earnings per share Moderate as opposed to excessive gearing Positive relative strength in the previous year Directors buying &quote;
Highlighted by 15 Kindle users
&quote;
The P/E ratio can often simply be compared with the prospective growth rate. A company growing at 15% per annum should certainly command a P/E of 15; at 20% per annum a P/E of 20 and so on. By dividing the growth rate into the P/E ratio a price earnings growth factor (PEG) is established, the aim being to find shares which have a PEG of well under one. &quote;
Highlighted by 13 Kindle users
&quote;
Our target is a prospective PEG of not more than 0.75 and preferably less than 0.66. &quote;
Highlighted by 12 Kindle users

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