Ep78: Eric Choe – Make an Investment Checklist and Check it Twice
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Guest profile
Eric Choe started his investment industry career as a sell-side equity analyst in South Korea, where he worked with Samsung Securities, ABN AMRO, and Deutsche Bank. After earning his MBA at The University of Chicago Booth School of Business, he worked at Fidelity Investments where he ran the Fidelity Thailand Fund. Currently, Eric manages multi-asset portfolios for high-net-worth individuals at a private bank based in Singapore.
“We must have an investment checklist … every investor has different factors they look for when they make investments and watch their investments. And I think everyone has to have a different checklist for what they’re comfortable with … (which) can evolve over time.”
Eric Choe
One lesson learned
One item on Eric’s own 10-point checklist:
If a stock is trading at a price-to-earnings growth ratio (PEG ratio) of above one, don’t invest in it. (The PEG ratio is a stock’s price-to-earnings [P/E] ratio divided by the earnings-per-share [EPS] growth for a specified time period). If he’s invested in a stock in which the PEG ratio goes above 1.0, he sells it, and if it’s trading at about 1.0, he will not buy it.
Andrew’s takeaways
- Avoid investing in a company that is competing against the government. One exception would be when the government is truly failing in its strategy.
- Entry of the government into an industry isn’t the end of the world. But it can really affect the multiple of your target company, and lower the price that people are willing to pay for a stock as their assessment of future growth will have fallen. Companies can survive, adjust and thrive, but their valuation will slide a little.
Connect with Eric Choe
Andrew’s books
- How to Start Building Your Wealth Investing in the Stock Market
- My Worst Investment Ever
- 9 Valuation Mistakes and How to Avoid Them
- Transform Your Business with Dr.Deming’s 14 Points
Andrew’s online programs
- Valuation Master Class
- Women Building Wealth
- The Build Your Wealth Membership Group
- Become a Great Presenter and Increase Your Influence
- Transform Your Business with Dr. Deming’s 14 Points
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About the show & host, Andrew Stotz
Welcome to My Worst Investment Ever podcast hosted by Your Worst Podcast Host, Andrew Stotz, where you will hear stories of loss to keep you winning. In our community, we know that to win in investing you must take the risk, but to win big, you’ve got to reduce it.
Your Worst Podcast Host, Andrew Stotz, Ph.D., CFA, is also the CEO of A. Stotz Investment Research and A. Stotz Academy, which helps people create, grow, measure, and protect their wealth.