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John Neff on Investing
 
 

John Neff on Investing (Paperback)

by John Neff (Author) "A FREEZING MORNING, in early January 1955, marked the start of my investment career ..." (more)
4.5 out of 5 stars  See all reviews (2 customer reviews)

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Product details

  • Paperback: 288 pages
  • Publisher: John Wiley & Sons; New edition edition (24 April 2001)
  • Language English
  • ISBN-10: 0471417920
  • ISBN-13: 978-0471417927
  • Product Dimensions: 22.6 x 15.2 x 2.2 cm
  • Average Customer Review: 4.5 out of 5 stars  See all reviews (2 customer reviews)
  • Amazon.co.uk Sales Rank: 760,051 in Books (See Bestsellers in Books)
  • See Complete Table of Contents

Product Description

Amazon.co.uk Review

John Neff is one of America's superstar mutual fund investors. Over 30 years, his fund has consistently outperformed the market by a wide margin. This may seem like no mean feat, but in stock markets where even the good eventually succumb to the average, this is truly Herculean. And here he tells his story.

Broadly speaking, growth investors seek those companies with fast growing earnings; value investors, of which Neff is one, seek those companies that other investors have discarded into the waste heap. Neff teaches how to sift through the rubble to uncover those valuable gems and nuggets that others ignore. He says, "if you do the work and answer the right questions, you can dine out on the down-and-out".

The book divides roughly into three: the first third is his Horatio Alger, rags-to-riches story: how all the New York investment banks turned up their noses at this mid-western lad; but he had the last laugh. The second section is where the meat is. Neff outlines techniques which value investors can employ to pick shares. He preaches a key indicator for readers to use to determine whether the company's growth prospects and low price warrants an investment. Neff provides numerous examples. The third section is a year-by-year description of his investment decisions, where he offers insights about the rational behind the decisions.

Over the last decade, value investing has fallen by the wayside, in favour of growth investing with a technological bent. Many investment managers have changed their style to meet the demands of retail and institutional investors. Neff believes this is a mistake. He says those that follow stock to towering heights do so at their own peril: "The capacity of investors to believe in something too good to be true seems almost infinite at times", especially at a market peak.

Neff, speaking from a vantage of a lifetime in the market, argues that staying the value course always wins out. This is a great handbook for those new to the game as well as the most seasoned portfolio managers. --Bruce McWilliams --This text refers to the Hardcover edition.

Financial Times, 6th November 1999

- "What makes Neff worth listening to is his investment record....That is a truly astonishing record which ranks him with the Buffetts, Lynches and Soroses of the world." --This text refers to the Hardcover edition.

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A FREEZING MORNING, in early January 1955, marked the start of my investment career. Read the first page
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Front Cover | Copyright | Table of Contents | Excerpt | Index | Back Cover
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Customer Reviews

2 Reviews
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Average Customer Review
4.5 out of 5 stars (2 customer reviews)
 
 
 
 
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5 of 5 people found the following review helpful:
4.0 out of 5 stars Well written "big picture" of low p/e investing, 24 Feb 2003
By A Customer
A very enjoyable read written in a non conventional style. Neff starts the book with a brief praecy of his life as a way to highlight his non traditional, or contrarian approach to investing. The second part of the book is where the "real meat" is contained. Neff writes about the indicators that he used to identify companies with investment potential, or in todays terminology the "stock screening process" that he went through. Once he has identified stocks worthy of further investigation then he progresses to a deep "fundamental" analysis of the stock. the only reason that I did not award this book 5 stars is that he says very little about what fundamental analysis means to him. I guess I shall be buying Security Analysis by Benjamin Graham :-)
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5.0 out of 5 stars John Neff gives back, 15 Nov 2009
By Mariusz Skonieczny "Author" (ClassicValueInvestors.blogspot.com) - See all my reviews
(REAL NAME)   
This review is from: John Neff on Investing (Hardcover)
Many of the investing legends, such as Warren Buffett, have someone that influenced their investment philosophy. For John Neff it was Sidney Robbins, a follower of Benjamin Graham and David Dodd. This book is about investing, but also about John Neff's personal life story. By reading about Neff's life experiences and his personality, readers can understand why value investing is such a good fit for him.

In Chapter 7, the author explains his investment style that his firm used whether the market was up, down, or indifferent. His investment criteria boils down to:

* Low price-earnings (p/e) ratio
* Fundamental growth in excess of 7 percent
* Yield protection (and enhancement, in most cases)
* Superior relationship of total return to p/e paid
* No cyclical exposure without compensating p/e multiple
* Solid companies in growing fields
* Strong fundamental case

I highly recommend this book to any investor. Next time you think about broad diversification, just remember this quote by John Neff,

"You can diversify yourself into mediocrity."

- Mariusz Skonieczny, author of Why Are We So Clueless about the Stock Market? Learn how to invest your money, how to pick stocks, and how to make money in the stock market
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