Lesson 19: What Comes After This Introductory Course in Value Investing

In my opinion, the true value of this introductory course in value investing isn’t primarily in the knowledge—it lies in the habits you develop. Successful value investing isn’t the result of a few brilliant moves, but of years of discipline and strong routines.

Here are five habits every value investor should cultivate, starting with the most fundamental.

Habit 1: Understand Risk

The biggest mistake novice investors make is misunderstanding risk. Too often, risk is equated with price volatility. But volatility isn't risk—it’s the price you pay for returns. The real risk is permanent loss of capital.

Before buying a stock, ask yourself: Can this stock lead to a permanent loss of my investment? If the answer is “yes” or even “maybe,” stay away.

Understanding what you’re buying, knowing why you're buying it, and assessing what could go wrong—that’s risk management.

Habit 2: Watch Your Behavior

The market doesn’t test your intelligence—it tests your emotional resilience. Investing demands self-control, not control over others. The greatest enemy of an investor is often... the investor themselves.

Be aware of behavioral pitfalls like overconfidence, herd mentality, confirmation bias, and framing effects. You don’t have to be perfect—you just need to be better than your impulsive self.

Those who manage their behavior come out ahead in the long run, even when the market turns against them.

I’d refer you back to Lesson 13 – The Psychology of Investing—and the reading and listening suggestions mentioned there:

• Het Beleggersbrein – Luc Kroeze (Dutch, I hope it gets translated sooni)

• The Psychology of Human Misjudgment – Charlie Munger (YouTube)

• Thinking, Fast and Slow – Daniel Kahneman

• Your Money and Your Brain – Jason Zweig
  And this leads seamlessly into the next point.
  
  

Habit 3: Read… and Keep Reading

The best investors are insatiable readers. Annual reports, books, biographies, interviews, sector analyses—any page can hold an idea that propels you forward for years.

If you read just a company’s annual report, you're already in the top 10% of investors. If you read the footnotes too, you're in the top 5%. If you also read a competitor’s report, you’re in the top 1%.

Reading sharpens your judgment, expands your knowledge, and protects you from rushed decisions. Knowledge is the best compounding mechanism there is.

Hundreds of books have been written on investing. For an average of €25, you gain access to someone’s life experience and best ideas.

Charlie Munger said: “In my whole life, I have known no wise people (over a broad subject matter area) who didn't read all the time—none. Zero.”

YouTube also holds countless outstanding speeches and interviews, but be selective.

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Habit 4: Understand Basic Accounting

You don’t need to become an accountant, but you do need to understand what a balance sheet, income statement, and cash flow statement are telling you.

Accounting is the language of business. Without this foundation, you’ll remain dependent on what others say, which is rarely a good idea in investing.

If you don’t know the difference between a current asset and a fixed asset, you have no business being in the stock market.

If you want to learn valuation in depth, take the free online course by Professor Aswath Damodaran, often called the dean of valuation: https://pages.stern.nyu.edu/~adamodar/

Habit 5: Set Goals

Investing without a goal is like driving without a destination. Of course, everyone wants to “make money,” but that’s too vague to provide real direction. Set clear financial goals: retirement, children’s education, buying a home, financial independence.

Your goals define your strategy, time horizon, and risk tolerance. And your goals can evolve—major life changes may require you to adjust them.

Knowing why you're investing gives you peace of mind, clarity, and motivation. It turns you into a conscious investor, instead of a nervous market watcher.

Conclusion

Good investors aren’t born—they’re made, not through brilliant insights, but by consistently applying simple, yet powerful habits over time.

Investing is a verb—and above all, a lifelong learning journey. Enjoy the process!