Growing Rich - Arabictrader.com

GROWING RICH WITH GROWTH STOCKS
Franklin Life and Lincoln National. “I didn’t say much,” he says. “But
I listened and was awed by the grandeur of these life-insurance
buildings. I figured there must be a lot of money stored inside. These
were really glamour stocks at the time. They were doubling every six
months to a year. It was pretty much an instant gratification group.
If my father liked a stock, you were well-advised to buy it, because
he knew what he was doing.” Franklin Life was the first stock Davis
bought at the tender age of 13. “It was terrific,” he says. “I think it
went up around 1,000 percent. As Peter Lynch would say, ‘It was a
ten-bagger.’ The company was eventually bought out by American
Tobacco.”
GETTING A BROAD PERSPECTIVE
Davis majored in history, not finance, at Princeton. “My father said
you can always pick up the accounting,” he shares. “He felt it was
important to have a broad perspective and understand how important
people are in the history of the world. Whether it’s Jesus Christ, Napoleon,
Peter the Great, or Winston Churchill, all had a huge impact
on society. I have always been interested in people and the human
side of history. Not so much in the battles we have faced, but on the
human decision process that goes into making things happen and
that change the course of events.”
PEOPLE ARE EVERYTHING
Davis’s first job out of college was working as a stock analyst for
the Bank of New York. He found that the bank was much more interested
in raw historical numbers than in going out and inspecting
companies. This was different from the approach he had learned from
his dad, and Davis pushed hard to have more emphasis placed on
talking and visiting with management. “I said, ‘Sure, we can update
the data using public material and research from other Wall Street
firms or sources like Value Line, Standard & Poor’s, or Moody’s,’” he
reflects. “But since I believed companies were made up of people, I
wanted a travel budget so I could go visit the firms I followed. They
did give me a little bit of money for that. I recall spending two or
three days in Akron, Ohio, visiting every tire and rubber company.
Goodyear, Firestone, General Cooper, Uniroyal, they were all there.
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