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When it comes to our investing toolkit, all we really need at our disposal are the hammer and the nail.
In other words, you don't need fancy bells and whistles to find undervalued companies ripe for market-crushing profits.
You don't need a broker who's probably ripping you off, and you especially don't need a Bloomberg terminal that costs $24,000 a year and takes up half your office.
All you need are the basics, most of which are free, publicly available, and right at your fingertips.
That's right: Independent research does it every time.
I've mentioned here before that publicly available 13F filings are one of the best tools retail investors can use to find unreasonably lucrative investment opportunities and gain and hold a profitable, sustainable edge.
I like to dig through these documents filed by money management firms every quarter to see exactly what the Wall Street bigwigs are buying and selling, as well as measure how well they're performing compared to the previous quarter.
By doing that, you get an exact picture of what the best and, let's be honest, worst investors are doing with their clients' funds.
And over my more than 27 years in the markets, I've dug through enough financial filings with my shovel and hard hat in tow to understand the most important lesson in investing...
About the Author
Tim Melvin is an unlikely investment expert by any measure. Raised in the "projects" of Baltimore by a single mother, he never attended college and started out as a door-to-door vacuum salesman. But he knew the real money was in the stock market, so he set sights on investing - and by sheer force of determination, he eventually became a financial advisor to millionaires. Today, after 30 years of managing money for some of the wealthiest people in the world, he draws on his experience to help investors find "unreasonably good" bargain stocks, multiply profits, and build their nest eggs. Tim tirelessly works to find overlooked "hidden gems" in the stock market, drawing on the research of legendary investors like Benjamin Graham, Walter Schloss, and Marty Whitman. He has written and lectured extensively on the markets, with work appearing on Benzinga, Real Money, Daily Speculations, and more. He has published several books in the "Little Book of" Investment Series and a "Junior Chamber Course" geared towards young adults that teaches Graham's principles and techniques to a new generation of investors. Today, he serves as the Special Situations Strategist at Money Morning and the editor of Peak Yield Investor.
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