PHIL TOWN

Does "Flash Trading" Affect Rule #1 Investors?

Anthony and Valerie Ball spotted a great article at MSN Money about nano-second computer trading at Goldman Sachs and other investment banks and hedge funds.  Read it to get clear that your mutual fund manager has a serious issue about buying and selling at reasonable prices. 

The question is whether this sort of "flash trading" - high volume small trades in parts of a penny - affects a Rule One investor in any sort of way.

Phil Town on Meaning - Reap What You Sow

I got this letter a couple days ago from Mark that I want to share with everyone. He has a question about one of the 4M's from Rule #1 - Meaning.

Hi Phil Town.  My name is Mark and I've been doing my best to learn as much as possible about Rule #1.  One of your big tenets is Meaning.  What does the company mean to me?  I'm not entirely sure I'm all the way on board with this idea as my main goal is making money, and even an "Evil Empire" like Exxon or their ilk can make a guy a boat load of cash.
 
But I read one of your blog posts about how Karma can come back and haunt you.  Have you ever read the book "The Secret" by Rhonda Byrne?  If you have, do you agree with the idea about laws of attraction?  Could this be why "Meaning" means so much in your investing model?  If I see stocks that are doing well and have the right kind of numbers, do I say no to them just because I may have a moral qualm about them?  Will the universe punish me for being greedy? :)
 
Anyway, I want to thank you for any time you can give me regarding this, and I hope that between RULE #1, the blog and my own research I can get a better understanding of how to find these great companies.

Here's what Phil Town told Mark:

Is it a Bad Sign When a Company Merges with Its Competitor?

Nick posted this comment on the Phil Town blog a few days ago. It's a good question for those of you looking to buy a company that's about to merge with a competitor.

Hey Phil Town,

I know you are really busy but I am unsure of what to do. I have been doing research on a company called Watson Wyatt Worldwide (WW). It is a service-based company that specializes in human capital consulting.

The company seems like a really great business but I just came across an article that says that Watson Wyatt is about to merge with its main competitor, Towers Perrin.

What should I do? Towers Perrin is not a publicly traded company, so I have no way of knowing whether or not it is a good company.

I want to invest in Watson Wyatt, but now I am afraid to because I feel like there's no way to know whether Watson Wyatt will be as fiscally sound in the future? Any advise would be greatly appreciated.

Thanks,
Nick

My answer: