Growing Rich - Arabictrader.com

Rule 4
TAKE A GOOD LOOK AROUND
YOU
Great investments are everywhere. That’s why you must always be
on the lookout for potential opportunities. Your next best investment
could be on one of the aisles in your grocery store, the sports page
of the newspaper, your child’s Christmas wish list for Santa, or even
on the beach during your trip to a tropical resort.
FOCUS ON THE BULL’S-EYE
Robert Stovall first learned the importance of incorporating the
events and trends around you when searching for promising investments
as an undergraduate at the University of Pennsylvania. “I had
a professor at the Wharton School named Julius Grodinsky who made
this concept so clear to me,” Stovall reports. “He didn’t think I was
very smart, and maybe he was right. But he made a favorable impression
on me, especially when he explained what I call the ‘bull’s-eye
concept.’”
Stovall teaches this same technique in his own classroom at New
York’s Stern Graduate School of Business today. “I draw a big bull’seye
on the blackboard to represent a given event,” he explains. “Let’s
use El Niño as an example. El Niño is the outer circle of the target,
or big picture. We all know what this is, what it does, and what it
might do. It’s a recurring weather pattern that warms sea temperatures
in the Pacific, which can trigger droughts in the Pacific basin or unleash
hurricanes in some areas of South America and Southern California.
Let’s say forecasters predict we’re in for the biggest El Niño
in a decade or maybe this century. That forecast forms the foundation
of our theme or concept. Now we take at look at what it might mean
for investors. Which companies or industries stand to benefit or be
hurt from El Niño if this prediction proves correct? Fire and casualty