Question 1: One of the most challenging aspects is the depth of qualitative research such as interviewing management, suppliers, and competitors. This requires good amount of persistence, access, and judgment .
Question 2: Warren Buffett – He would emphasize the sections on management integrity and long-term competitive advantage, aligning with his focus on “moats.”
Peter Lynch – He would lean on the checklist’s industry and product-level questions, since he favored investing in businesses he personally understood.
Benjamin Graham – He would prioritize the financial strength and valuation parts of the checklist, consistent with his margin-of-safety principle.
Philip Fisher – He would use the checklist’s qualitative questions about innovation and management vision, echoing his scuttlebutt approach.
Question 3: Shearn encourages everyone to customize “The checklist is not meant to be rigid; it is a framework to be adapted to your own style of investing.” I would add more competitive aspects like 5 forces . I would also add macroeconomic filters (tariffs, trade policy, cost structures) to align with long term outlook. After WB had to sell TSMC.
Question 4: Shearn himself says “mastery comes from repetition and reflection.”
How much time depends on how focused the person is. For an unfocused unserious ,it would take a lifetime :-(
General proficiency in 2 years for focused hard working, Mastery would take Several years (7+), since it requires building judgment, pattern recognition, and the ability to adapt the checklist across industries and cycles . Mastering the market cycle is a long term aspect
Q5:
Act as an investment analyst using Michael Shearn’s checklist.
Evaluate [Company Name] by answering the following:
1. What is the company’s business model and how does it make money?
2. What are the key risks in its industry and competitive landscape?
3. How strong is management’s track record and integrity?
4. What is the company’s financial strength and valuation?
5. Does the company have a durable competitive advantage (moat)?
6. What external factors (regulation, supply chain, macro trends) could impact it?
Provide a structured analysis with both qualitative and quantitative insights.
Some aspects of the checklist that would be challenging:
- Evaluate as a CEO would require a big picture understanding of how all the pieces work together--that sounds like something that takes time to develop.
- Determining sustainable competitive advantage because this is a hypothesis about the future and requires understanding of multiple companies in the industry.
- Relationship with supplier would require more in person style research that I'm not in the position to do.
- Deciphering the character of the accounting standards used.
- Management analysis will take time because people are complex.
I would tweak the management process. For one, I may be willing to buy before I have all these questions answered if the other boxes were ticked because some of these questions may need time to play out. Second, I also have mixed feelings on docking management for having strategic plans to conduct business and don't see a problem with them issuing guidance.
Q4:
I appreciate the question, because I wasn't taking that into consideration. Research, if a skill, would need practice. Financial research process will probably come quicker, but I think the more complex items like really understanding how a company works, competitive durability and future growth and developing discernment for good management will take time, experience, practice, and failure, to really 'master'. I think it's good to realize that if I sat down today with all 40 items, 1) there are still a lot of skills I need to grow before I could actually 'accomplish' them and 2) I would still need to go through the process many times. AI will continue to be helpful in gathering the information, but I'm still going to need to develop the skills of what to do with it.
Q5:
Prompt for Management research. (This could be way more extensive as he spent 3 chapters on analyzing management.)
Step 1: Build a chronological career history of TIKR's CEO. Use historical proxy statements and articles from the past 10 years.
Step 2: Analyze and report back:
1. Do they have a history of making deals, financial engineering, marketing or creating new products?
2. Do they have a background in operations, marketing or finance?
3. Do they jump from job to job or do they have a long tenure in the industry?
4. Are there any red flags in their career history?
There is a lot of good material in this book to build prompts for AI to help research. Which brings up the question about how long it will become necessary to do this research ourselves? Now, services built on these types of AI prompt/frameworks could provide exponentially better qualitative profiles for companies. Does that lead to a more automated, level playing field?
Q1. I would find building the human sources element to be a challenging part of the process. One does have access to plenty of information through both filings, researching articles and information provided by the company itself. Finding individuals who want to share their perspectives may consume more time that one would be able to devote to the process.
Q 2. Each investor would focus on the criteria best suited to evaluate the type of investments they made. The incorporation of both quantitative and qualitative factors would vary according to each investor's style. It's interesting that he spent as much if not more time on the quality of management than on quantitative measurements. The set of metrics used to understand and value an investment would change both given the investor and the type of company he was evaluating. Just as important as the ability to grow is the ability to survive challenging circumstances.
Q3. The checklist he presents is very comprehensive which enables one to limit the possibility of overlooking items which may be extremely important. His checklist would be valuable to use when searching for quality companies with both the ability to survive and grow. Also useful is the number of resources he mentions to use in the research process and how to use them.
Q4. The quantitative portion of the evaluation process would be easier to adopt as most of that type of information is readily available. It's the quantitative portion which would be more challenging. One would have to ask themselves, what are the right questions to ask, what am I missing, how are my own biases affecting the way I am looking at the information I have. What is potentially being left out can be as important as the information which is available. I believe corporate culture is one of the more important parts of the value of a company.
Q5. I would use AI to combine the quantitative metrics with the sources of information to search for potential candidates for investment. This would narrow the field of potential investment candidates. Then I would apply qualitative factors to further narrow the field of potential candidates. I'm not sure how useful AI would be in finding and evaluating qualitative issues. The way the search question is worded would be extremely important. I think it would be easier to get information which wasn't as useful in this segment of the process.
Which aspect of the research process outlined by the author do you think will be the most challenging for you to perform? Why
the biggest challenge of this work is to find the time to conduct all the different types of research outlined in the book. Some of the processes can be automated by AI. Some needs to be done personally and over a considerable period of time the requirement to speak to management directly and spend time assessing their competence of many years requires a substantial investment of time. Thus this type of research lens itself to a more intense and in-depth process suitable for a small number of companies rather than a wide net.
Question two. How would each of the investors that we have studied customise the approach described in this book to their own investment process?
Tillinghast
Would have liked the sections on finance and financial risk and management of sector risk.
Boulton
Would’ve liked the section on management and assessment of management strength and business strengths. Would’ve like the emphasis and research on ownership and management incentive to earning shares and options.
Neff
He would’ve liked the sector analysis and evaluation of business strength. He would also have liked the financial analysis and assessment of the strength of the business and the ability to grow and sustain debt.
Lynch
Peter Lynch would’ve liked most of this book. He talks about almost all the areas covered and seemed to go into a similar level of detail.
Greenblatt
Joel would also have rated most of this book. He believed in deep analysis of a small number of securities. He would’ve tolerated a higher level of debt and more risk than is suggested in the investment checklist.
Jim Rogers
I think Jim would’ve found the least use in this book however I still think he probably did many of the items on this checklist because no matter how macro a view you take you do need to check that the investments you’re making are based on sound foundations.
Michael Steinhardt
Michael style would also not have suited this type of fundamental analysis but like Jim Rogers I suspect he did his due diligence on the positions he took.
George Michaelis
George would have appreciated the analytical side of this book and would also have liked the quality measures. He also had a conservative view of debt similar to Michael Shearn.
George Soros
Not really relevant to George Soros style of investment.
Ralph Wanger
Ralph would’ve appreciated the analysis of management and stakes in the business. He would also have light the sector analysis and the strength of the business model.
Warren Buffett.
Warren Buffett would’ve liked a lot of this book. He would have appreciated the emphasis on strong and honest management. He would’ve appreciated the relatively high moral standards required throughout businesses to be successful. He would also have liked the analysis and the sector analysis and the business model strength.
Phil Fisher
Phil would have appreciated the analysis of management and the in-depth research to make sure that they are competent honest and make good decisions. He also would’ve liked the analysis of the sector and the opportunities for growth at a high rate of return. He would’ve had less time for the valuation metrics.
Ben Graham
Ben would have liked the fundamental analysis and the strength of the business and the conservative financial leverage. He would’ve been less interested in the strength of the management and the future prospects of the business. He would’ve regarded these as qualitative and therefore of secondary importance to the fundamental value of the assets and earnings of the business.
Question 3. How would you like to customise what you learned from this book to your own investment process? Why?
I think that if I tried to apply all the tests in this book to every investment that I considered, I would find the workload overwhelming. However, you don’t necessarily need to approach it in that way. for example, a company with an excellent long-term track record of generating shareholder value does not necessarily need a close assessment of the management. Their results speak for themselves. In the case where a management has changed or a turnaround is required, or a mistake has been made which could either be an external or internal error, assessing the management becomes much more urgent.
This is a vital assessment and suffers from the subjective nature of the judgment. I liked his approach to this intrinsically difficult problem. By looking at it from multiple angles, you have a better chance of triangulating a rigorous assessment of their competence and integrity.
Question 4. How much time do you think it would take for you to learn to be proficient of the authors research process? To learn to master it?
The short answer is a long time. I had the experience as I read the book of thinking that in many areas I already had a good grasp of the principles involved. But in most areas he had some useful extra things to say, and in some areas a great deal. It reads more like a checklist of all the things that you can assess and ways to assess them as opposed to an investment style. I believe that AI offers considerable help in checking at least the basics of some of the areas he covers. As always with AI, the results need to be checked and if any doubt is raised, a more thorough assessment is indicated.
Question 5
“ As a professional securities analyst, assess the outcomes of measurable targets made by company X in RNS announcements over the past 5 years. Output. A table showing the target, the outcome and an assessment of whether the outcome achieved the target.”
Question 1: One of the most challenging aspects is the depth of qualitative research such as interviewing management, suppliers, and competitors. This requires good amount of persistence, access, and judgment .
Question 2: Warren Buffett – He would emphasize the sections on management integrity and long-term competitive advantage, aligning with his focus on “moats.”
Peter Lynch – He would lean on the checklist’s industry and product-level questions, since he favored investing in businesses he personally understood.
Benjamin Graham – He would prioritize the financial strength and valuation parts of the checklist, consistent with his margin-of-safety principle.
Philip Fisher – He would use the checklist’s qualitative questions about innovation and management vision, echoing his scuttlebutt approach.
Question 3: Shearn encourages everyone to customize “The checklist is not meant to be rigid; it is a framework to be adapted to your own style of investing.” I would add more competitive aspects like 5 forces . I would also add macroeconomic filters (tariffs, trade policy, cost structures) to align with long term outlook. After WB had to sell TSMC.
Question 4: Shearn himself says “mastery comes from repetition and reflection.”
How much time depends on how focused the person is. For an unfocused unserious ,it would take a lifetime :-(
General proficiency in 2 years for focused hard working, Mastery would take Several years (7+), since it requires building judgment, pattern recognition, and the ability to adapt the checklist across industries and cycles . Mastering the market cycle is a long term aspect
Q5:
Act as an investment analyst using Michael Shearn’s checklist.
Evaluate [Company Name] by answering the following:
1. What is the company’s business model and how does it make money?
2. What are the key risks in its industry and competitive landscape?
3. How strong is management’s track record and integrity?
4. What is the company’s financial strength and valuation?
5. Does the company have a durable competitive advantage (moat)?
6. What external factors (regulation, supply chain, macro trends) could impact it?
Provide a structured analysis with both qualitative and quantitative insights.
Q1:
Some aspects of the checklist that would be challenging:
- Evaluate as a CEO would require a big picture understanding of how all the pieces work together--that sounds like something that takes time to develop.
- Determining sustainable competitive advantage because this is a hypothesis about the future and requires understanding of multiple companies in the industry.
- Relationship with supplier would require more in person style research that I'm not in the position to do.
- Deciphering the character of the accounting standards used.
- Management analysis will take time because people are complex.
- Determining future growth
Q2:
https://docs.google.com/document/d/e/2PACX-1vQxxGQWWpdQ2ySDJ90nOEZ7j1iI-ZlSQBxfnKxrxfazI5gux0000v3WdxWHvW4mb3Dx_n4J4K9BbXdR/pub
Q3:
I would tweak the management process. For one, I may be willing to buy before I have all these questions answered if the other boxes were ticked because some of these questions may need time to play out. Second, I also have mixed feelings on docking management for having strategic plans to conduct business and don't see a problem with them issuing guidance.
Q4:
I appreciate the question, because I wasn't taking that into consideration. Research, if a skill, would need practice. Financial research process will probably come quicker, but I think the more complex items like really understanding how a company works, competitive durability and future growth and developing discernment for good management will take time, experience, practice, and failure, to really 'master'. I think it's good to realize that if I sat down today with all 40 items, 1) there are still a lot of skills I need to grow before I could actually 'accomplish' them and 2) I would still need to go through the process many times. AI will continue to be helpful in gathering the information, but I'm still going to need to develop the skills of what to do with it.
Q5:
Prompt for Management research. (This could be way more extensive as he spent 3 chapters on analyzing management.)
Step 1: Build a chronological career history of TIKR's CEO. Use historical proxy statements and articles from the past 10 years.
Step 2: Analyze and report back:
1. Do they have a history of making deals, financial engineering, marketing or creating new products?
2. Do they have a background in operations, marketing or finance?
3. Do they jump from job to job or do they have a long tenure in the industry?
4. Are there any red flags in their career history?
There is a lot of good material in this book to build prompts for AI to help research. Which brings up the question about how long it will become necessary to do this research ourselves? Now, services built on these types of AI prompt/frameworks could provide exponentially better qualitative profiles for companies. Does that lead to a more automated, level playing field?
Q1. I would find building the human sources element to be a challenging part of the process. One does have access to plenty of information through both filings, researching articles and information provided by the company itself. Finding individuals who want to share their perspectives may consume more time that one would be able to devote to the process.
Q 2. Each investor would focus on the criteria best suited to evaluate the type of investments they made. The incorporation of both quantitative and qualitative factors would vary according to each investor's style. It's interesting that he spent as much if not more time on the quality of management than on quantitative measurements. The set of metrics used to understand and value an investment would change both given the investor and the type of company he was evaluating. Just as important as the ability to grow is the ability to survive challenging circumstances.
Q3. The checklist he presents is very comprehensive which enables one to limit the possibility of overlooking items which may be extremely important. His checklist would be valuable to use when searching for quality companies with both the ability to survive and grow. Also useful is the number of resources he mentions to use in the research process and how to use them.
Q4. The quantitative portion of the evaluation process would be easier to adopt as most of that type of information is readily available. It's the quantitative portion which would be more challenging. One would have to ask themselves, what are the right questions to ask, what am I missing, how are my own biases affecting the way I am looking at the information I have. What is potentially being left out can be as important as the information which is available. I believe corporate culture is one of the more important parts of the value of a company.
Q5. I would use AI to combine the quantitative metrics with the sources of information to search for potential candidates for investment. This would narrow the field of potential investment candidates. Then I would apply qualitative factors to further narrow the field of potential candidates. I'm not sure how useful AI would be in finding and evaluating qualitative issues. The way the search question is worded would be extremely important. I think it would be easier to get information which wasn't as useful in this segment of the process.
Which aspect of the research process outlined by the author do you think will be the most challenging for you to perform? Why
the biggest challenge of this work is to find the time to conduct all the different types of research outlined in the book. Some of the processes can be automated by AI. Some needs to be done personally and over a considerable period of time the requirement to speak to management directly and spend time assessing their competence of many years requires a substantial investment of time. Thus this type of research lens itself to a more intense and in-depth process suitable for a small number of companies rather than a wide net.
Question two. How would each of the investors that we have studied customise the approach described in this book to their own investment process?
Tillinghast
Would have liked the sections on finance and financial risk and management of sector risk.
Boulton
Would’ve liked the section on management and assessment of management strength and business strengths. Would’ve like the emphasis and research on ownership and management incentive to earning shares and options.
Neff
He would’ve liked the sector analysis and evaluation of business strength. He would also have liked the financial analysis and assessment of the strength of the business and the ability to grow and sustain debt.
Lynch
Peter Lynch would’ve liked most of this book. He talks about almost all the areas covered and seemed to go into a similar level of detail.
Greenblatt
Joel would also have rated most of this book. He believed in deep analysis of a small number of securities. He would’ve tolerated a higher level of debt and more risk than is suggested in the investment checklist.
Jim Rogers
I think Jim would’ve found the least use in this book however I still think he probably did many of the items on this checklist because no matter how macro a view you take you do need to check that the investments you’re making are based on sound foundations.
Michael Steinhardt
Michael style would also not have suited this type of fundamental analysis but like Jim Rogers I suspect he did his due diligence on the positions he took.
George Michaelis
George would have appreciated the analytical side of this book and would also have liked the quality measures. He also had a conservative view of debt similar to Michael Shearn.
George Soros
Not really relevant to George Soros style of investment.
Ralph Wanger
Ralph would’ve appreciated the analysis of management and stakes in the business. He would also have light the sector analysis and the strength of the business model.
Warren Buffett.
Warren Buffett would’ve liked a lot of this book. He would have appreciated the emphasis on strong and honest management. He would’ve appreciated the relatively high moral standards required throughout businesses to be successful. He would also have liked the analysis and the sector analysis and the business model strength.
Phil Fisher
Phil would have appreciated the analysis of management and the in-depth research to make sure that they are competent honest and make good decisions. He also would’ve liked the analysis of the sector and the opportunities for growth at a high rate of return. He would’ve had less time for the valuation metrics.
Ben Graham
Ben would have liked the fundamental analysis and the strength of the business and the conservative financial leverage. He would’ve been less interested in the strength of the management and the future prospects of the business. He would’ve regarded these as qualitative and therefore of secondary importance to the fundamental value of the assets and earnings of the business.
Question 3. How would you like to customise what you learned from this book to your own investment process? Why?
I think that if I tried to apply all the tests in this book to every investment that I considered, I would find the workload overwhelming. However, you don’t necessarily need to approach it in that way. for example, a company with an excellent long-term track record of generating shareholder value does not necessarily need a close assessment of the management. Their results speak for themselves. In the case where a management has changed or a turnaround is required, or a mistake has been made which could either be an external or internal error, assessing the management becomes much more urgent.
This is a vital assessment and suffers from the subjective nature of the judgment. I liked his approach to this intrinsically difficult problem. By looking at it from multiple angles, you have a better chance of triangulating a rigorous assessment of their competence and integrity.
Question 4. How much time do you think it would take for you to learn to be proficient of the authors research process? To learn to master it?
The short answer is a long time. I had the experience as I read the book of thinking that in many areas I already had a good grasp of the principles involved. But in most areas he had some useful extra things to say, and in some areas a great deal. It reads more like a checklist of all the things that you can assess and ways to assess them as opposed to an investment style. I believe that AI offers considerable help in checking at least the basics of some of the areas he covers. As always with AI, the results need to be checked and if any doubt is raised, a more thorough assessment is indicated.
Question 5
“ As a professional securities analyst, assess the outcomes of measurable targets made by company X in RNS announcements over the past 5 years. Output. A table showing the target, the outcome and an assessment of whether the outcome achieved the target.”