CRA Research Club

Why join the Chartered Research Analyst (CRA) Investment Research Club?

1. Discuss and debate great investment ideas with other CRA candidates studying and practicing Graham-Buffett Value Investing. One great idea could bring you profits many times your annual membership fee.
2. Ask in-depth research questions about specific investment ideas and do research together about each situation.
3. Share superinvestor lecture notes and investment research notes.
4. Train and exercise your money mind together with other researchers passionate about value investing. Form mastermind alliances.

Join our research club now for only $98 by clicking below:

One good idea could bring you profits many times your annual fee!

The Power of Simplification

One of the fundamental problems that every value investor faces today is that there are too many financial reports, too many SEC filings and too many models… but we only have 24 hours a day. In the past, I used to work so hard absorbing so much information and so much accounting footnotes and still end up somewhat confused in the end. I would have a cluttered file and a cluttered desk, and still don’t have enough information to make up my mind and place my bet.

On the contrarily, successful investors like Warren Buffett are the masters at the art of simplification. They have a simple framework, a clear focus, and a strict discipline. They focus on what is knowable and what is important. They ignore all the noise and smoke. They don’t get confused at too many unimportant readings and models. And that’s how they become extremely focused, extremely disciplined, and extremely successful.

The amazing power of simplification was discovered hundreds of years ago in Shaolin Temple, China. The Buddhist monks there learned that a simple and focused mind can propel the human body to produce amazing power and strength during Kung Fu fights. This discovery of theirs in the primitive science of human body would later become the foundation of oriental Zen training.

Value investing is the martial art of the mind. In my opinion, there are three basic steps in any discipline of mental art:

(1) Beginner’s Step: The mind starts with a thin and small book of basics.

(2) Advanced Step: The mind accumulates more and more details and becomes a thick and huge encyclopedia.

(3) Enlightenment Step: The mind penetrates and cuts across all the details, and boils down the thick encyclopedia back into a thin booklet pointing direct at the heart of the matter.

This mind process is similar to how we help our kids to solve puzzles: You start with one piece of the puzzle. You then collect more and more pieces. And finally you put together all the pieces to form one big piece from which you see the light.

Only after the third enlightenment step, can the mind start to see the big picture and become a master. The enlightenment or simplification step is what separates true masters from the rest of us. And there is usually no giant leap but a series of small steps and continuous efforts.

In our research meetings at Zenway.com, we always try to focus on the first step to point to the right direction and the third step to get back to the basics. It’s just like the powerful KISS principle in America: “Keep It Simple, Sweetie!”

With that said, we also have to remind ourselves of another Universal principle: the law of yin-yang, that is, there is a flip side to every issue. So in terms of simplification, we have to remember that everything should be made as simple as possible, but not simpler. Einstein said that, if he didn’t, he should.

So the details in the second step is necessary and important. But it is the capacity to simplify and focus that leads to master hood.

What do you think? I appreciate your comment via this web form. (Brian Zen, CFA)

A Place in the Sun

Warren Buffett once said that, at the heart of the matter, he and his musician son, Peter Buffett, are essentially doing the same thing. As value investors, we compose music with capital and with focus. Here below is a blind man who really focused. He penetrated the clouds in his own mind and created something amazingly beautiful that penetrated the hearts of people all around the world. If a blind man can do it. Why can’t we?

A Place In The Sun
by Stevie Wonder

Like a long lonely stream
I keep runnin’ towards a dream
Movin’ on, movin’ on
Like a branch on a tree
I keep reachin’ to be free
Movin’ on, movin’ on.

‘Cause there’s a place in the sun
Where there’s hope for ev’ryone
Where my poor restless heart’s gotta run.
There’s a place in the sun
And before my life is done
Got to find me a place in the sun.

Like an old dusty road
I get weary from the load.
Movin’ on, movin’ on
Like this tired troubled earth
I’ve been rollin’ since my birth
Movin’ on, movin’ on

‘Cause there’s a place in the sun
Where there’s hope for ev’ryone
Where my poor restless heart’s gotta run.
I know there’s a place in the sun
And before my life is done
Got to find me a place in the sun.

You know when times are bad
And you are feeling sad
I want you to always remember:

Yes, there’s a place in the sun
Where there’s hope for ev’ryone
Where my poor restless heart’s gotta run.
I know there’s a place in the sun
And before my life is done
Got to find me a place in the sun.

Sit Tight on Loews Corporation (LTR)

In the end of August, 2003, we started buying Lowes Corporation (LTR) for our clients around $41 per share. Here is the time-stamped message to our clients. After a 3-for-1 stock split, our cost bases is $13.67. With the stock trading around $50 now, we have a 266% gain in the stock.

We have recently received an exchange offer from Loews Corporation to exchange 0.70 shares of Lorillard, Inc. (LO) for each share of Loews Corporation (LTR).

After a careful study of the “Offer to Exchange/Prospectus”, we recommend our clients to sit tight with their LTR and ignore the exchange offer.

(Stay tuned for our LTR case study. Potential investors and clients have asked us about our investment thought process. We will be posting some of our historical case studies in the future.)

How to Make 50% a Year like Warren Buffett

Warren Buffett achieved 50% return on small amount of capital during his early years. When asked about how he would try to do that again today, he shared the following tips:

Focus on things that are knowable and important.
Mr. Buffett wouldn’t care about a possible recession; He wouldn’t spend a minute thinking about it. The next 20 years should be good; He is in the investment game forever. He focus on things that are knowable and important. He doesn’t know how to forecast, it’s meaningless to him.

Win by playing your game or finding weak opponents.
Mr. Buffett looks at himself as a golfer. “We don’t know which holes will come and in what order, but over 18 holes, we will win by playing our game or finding weak opposition,” said Mr. Buffett. Look at See’s Candy, Coca-cola – nothing else is in your mind when it comes to candy or soda. Share of mind equals share of market.

Capitalize on small capitalizations and human emotions.
In 1998, people behaved like frightened cavemen (referring to the Long Term Capital Management meltdown). They will be frozen by fear, excited by greed and it doesn’t matter what are their IQ’s and degrees, etc. Growth of 50% per year is achieved with small capitalization stocks, not large caps. It’s just capitalizing on human behavior. It’s human emotion that creates opportunities when people are frozen by fear or excited by greed. Human behavior allows for success if you are able to detach yourself emotionally. (That’s where Zenway Retreat comes into the picture.)

Seek out publishers of stock information and look for various investment guides.
Go through every investment manual page by page. Looking at a copy of the 1951 Moody’s, on page 1433, there’s a stock you could have made some money on. The EPS was $29 and the Price Range was from $3-$21/share. On another page, there is a company that had an EPS of $29.5 and the price range was $27-28, one times earnings. You can get rich finding things like this, things that aren’t written about. Or you can look through investment guides on Korean stocks like Mr. Buffett did.

Look for simple things that can’t go wrong.
“In your investing life, you will have several opportunities and one or two that just can’t go wrong,” said Mr. Buffett. For example, in 1998 the NY Fed offered 30-year treasury bonds yielding less than the 29-½ year treasury bonds by 30 basis points, because Long Term Capital was trying to get out of a highly leveraged trade. In a situation like that, he would jump in with 75% of his networth if he had only a small amount of capital.

It is hard to stick to the basics everyday while finding nothing exciting.
Based on my personal experience with investing and Zen training, the key is to labor through the boring searches with unrelenting attention like a Zen monk day-by-day and suddenly catch the rare moment when other people’s attention is slipping away or they are distracted by the emotions and sensations at the time. It is only during those brief and rare moments when you will catch the Warren Buffett type of simple stuff that can’t go wrong. So sticking to the simple stuff is not easy. But if you try to be a little smarter, you may end up a lot dumber, said Mr. Buffett. At Zenway.com, we try very hard just to stick to what is simple and understandable. This alone is no easy feat since the human mind tends to wander.

Zenway is about doing simple things extraordinarily well.
Our Zen of investing is getting back to the basics, apply ancient tried-and-true mind empowerment techniques, and focus on doing simple things extraordinarily well. (Brian Zen, CFA)

Money Mind Taichi

Ancient Kungfu Master in the East discovered the mysterious link between the mind and the body thousands of years ago, now Western scientists are coming up with solid scientific evidences about exercise & brain power.

Some outsiders in the past have ridiculed Zenway Taichi before. “Why a money management firm is fooling around with Taichi moves? Isn’t it unprofessional and uncorporate?” Now, brain scientists are coming up with evidences that Zenway Taichi could indeed to help us get more insightful research powered by a stronger money mind.

We all know that exercise is good for our bodies, but new studies show that it’s also good for our brains. A March 26th Newsweek article titled “Stronger, Faster, Smarter” reported that researchers are “realizing that the mental effects of exercise are far more profound and complex than they once thought”. Dr. John Ratey, author of the book “Spark: The Revolutionary New Science of Exercise and the Brain”, which will be released later this year, points out that the neurotransmitters dopamine, serotonin and norepinephrine are all elevated after physical exercise; he observes that “having a workout will help with focus, calming down, impulsivity – it’s like taking a little bit of Prozac and a little bit of Ritalin”. Yes, it’s difficult finding time to exercise in this crazy busy world; however, when you consider the benefits it will bring to your body – and your brain – it’s worth the extra effort.

At Zenway, we design research and marketing programs to combine work and play for our associates. We stress the importance of physical exercise so we can do better research work and come up with better insights about each complex investment situation. Through years of practice and first-hand research, we design a complete set of powerful exercises specifically designed unleash the full potential of our associates’ money mind. In a sense, Zenway is the pioneer in designing exercises for the Graham-Buffett value investors. We have a Superinvestor Zenway Retreat coming up in November , 2008 at World Financial Center location in New York. Join our passionate group and develop a religious zeal to unleash your superinvestor within.

Ordinary Miracle

Zenway is about seeking the miracle in the ordinary. Here is a great song that captured that spirit. As a young pianist and entrepreneur, I hope I could write a song like that one day. Stay tuned! (Hilary Zen)

“Ordinary Miracle”
From Movie “Charlotte’s Web”

It’s not that unusual
When everything is beautiful
It’s just another
Ordinary miracle today

The sky knows when it’s time to snow
Don’t need to teach a seed to grow
It’s just another
Ordinary miracle today

Life is like a gift, they say
Wrapped up for you everyday
Open up, and find a way
To give some of your own

Isn’t it remarkable?
Like everytime a raindrop falls
It’s just another
Ordinary miracle today

The birds in winter have their fling
And always make it home by spring
It’s just another
Ordinary miracle today

When you wake up everyday
Please don’t throw your dreams away
Hold them close to your heart
‘Cause we are all a part

Of the ordinary miracle

Ordinary miracle

Do you want to see a miracle

It seems so exceptional
That things work out after all
It’s just another
Ordinary miracle today

The sun comes out and shines so bright
And disappears again at night
It’s just another
Ordinary miracle today

It’s just another
Ordinary miracle today

CEO Gourmet Tasting Club

Who doesn’t enjoy enchanting moments with wonderful friends over fantastic food and wine?

Zenway CEO Gourmet Tasting Club^TM offers unique opportunity to you to host a private gourmet tasting for the professionals and executives in our network, together with your friends and family.

One of our trained team leaders will help you to make sure that your party is well organized, entertaining and financially enlightening for you and your friends.

Most importantly as host, you won’t have to worry about:

• Providing food – because every guest will bring one dish! And the guest bringing the best dish will win a surprise gift plus product discounts.
• Cleaning – because we will help!
• Inviting friends – because our team will help you through a structured process.
• PLUS the rewards for hosting a party are too good to refuse. You get a FREE one-year membership plus discounts.

As a token of appreciation, Zenway offers all hosts special incentives. Firstly, simply by hosting a party, you will receive our acclaimed research reports with powerful ideas that could change your financial future. Secondly, you have the opportunity of receiving additional incentives based on the results of your party. Finally, you have the ability to join our tasting club for free and continue to bring people fun, financial success and peace of mind.

Please don’t hesitate to contact your recruiting partner for more details. Or you can call Zenway at 646.388.0887.

Solution for TaxCut 2007 Installation Error

Tax filing is an important part of financial peace of mind. This year, one of our clients had a problem installing Taxcut 2007 Premium Federal + State under Vista. Here is the error message:

Error: Error 1320 ‘The specified path is too long. C:\Users\USERNAME\My Documents\TaxCut.’

We discovered this error is due to changing Vista’s default “My Documents” location, so the default “My Documents” directory the TaxCut was using didn’t exist. The fastest solution was to temporarily change the “My Documents” location back to default, install Taxcut, and then create a desktop shortcut to where your old documents are, or change the “My Documents” location again to your choosing.

To change “My Documents” back to default, you need to go to: Vista Start > My Documents > Right click > Properties > Location > Restore Default.

Hope this message could help someone. You could help us back by referring us to your friends who might be interested in joining our financial enlightenment movement, bring financial success and peace of mind to people around the world through family-based education, training, research and wealth management. (Yan Zen, MD)

Financial Intelligence Networking

Explore the exciting opportunities in the financial education and advisory industry!

FRIDAY APRIL 18TH: CAREER EXPO at NEW YORK SOCIETY OF SECURITY ANALYSTS
2-3:30 PM Brian Zen will talk about what we can learn from Warren Buffett’s career path.
Click Here for More Information

SATURDAY MAY 17TH: PROFESSIONAL NETWORKING LUNCH PARTY
1. Share big investment ideas and best business practices.
2. Swap great jokes and meet wonderful friends.
3. Learn a hilarious Taichi Hiphop move from our stand-up comedian. At Zenway, we take fun and health seriously.

Date: Saturday, May 17
Time: 1:30 PM – 5 PM
Cost: FREE
RSVP required. Please email your name and phone number to: RSVPzw@gmail.com

1:30-4 PM LUNCH PARTY: EVERYONE BRINGS A DISH
Place: 211 North End Ave (at Murray St, near WFC) New York, NY 10282
Tel: 646.388.0887

4-5 PM THEATER PERFORMANCE AT WINTER GARDEN, WORLD FINANCIAL CENTER
“CORPORATE CARNIVAL”
Performed by Women’s Project http://womensproject.org
Returning to the World Financial Center with Corporate Carnival, Women’s Project presents feats of balance, strength and magic, while juggling hedge funds, unleashing the retail giantess, eating the glass ceiling, challenging the strongman to wrestle with Sarbanes-Oxley, and many more daredevil acts. Catch a glimpse of the carnies as they roam the corridors of the World Financial Center, interacting with the public in surprising ways. Don’t miss the show’s culmination on the Winter Garden’s grand staircase where performers will spin extraordinary tales of corporate life.

Initial career interview & financial health checkup:
BY APPOINTMENT ONLY: 646.388.0887

HELP WANTED! Some say: “Quit your job, stop doing what you hate and start doing what you love.” We say keep you job if you need it to pay bills while getting started in arguably the best business out there joining our network of independent professionals. We are seeking self-motivated entrepreneurs to join our Investment Advisor/Research Analyst training program, where you would have the opportunity to:

1. Get the career training while working part-time to build your own investment management and advisory practice within a franchised umbrella. Highly competitive compensation and bonus structure. Equity participation offered to top talent. We have a proprietary, proven system to empower your money mind and unleash your potential.

(If you know any highly self-motivated entrepreneurial individual, please invite them over. You will get paid a generous finder’s bonus.)

2. We are not selling hype. We offer step-by-step action plans and activities for you to follow. With us, you can help yourself and at the same time, help others to build meaningful wealth and change people’s lives. The upside is substantial. You could really do well if you master our proprietary networking and research skills.

3. Start in an organization at the top level, rather than climbing up the corporate ladder from the bottom. Get to become a partner and participate future IPO at ground level without laying out initial risk capital.

Please invite high energy hard-working people to our career session where we will introduce our plan and show you the opportunity.

This is a ground-floor opportunity! We are not looking for “employees”. We are looking for partners.

Any questions? Please call 646.388.0887.