- Many would like the formula for calculating intrinsic value and deriving a margin of safety.
- I’ll discuss a few issues about the margin of safety that are mostly up to one’s personal preferences.
- There are also some issues with a margin of safety. It’s not really free.
I get lots of questions about how to properly value a company, what the best method is to determine intrinsic value, what clear buying signals look like, and especially a lot of questions on the best valuation metrics and financial indicators to use.
I completely understand where these questions come from as it’s in our nature to simplify things and look for the magic formula that has all the answers, especially in an uncertain environment like financial markets are. However, investing and especially value investing, isn’t that easy. More →