How to pass an exam
1. You are several months away from the exam. Identify the best textbook on the subject, the most insightful author. Find a model to organise the subject. Identify the main topics and sub-topics. Cover everything. Study exhaustively.
2. You are only a few days away from the exam. Identify the most likely source of exam questions. Narrow down the numbers of questions you must prepare. Go through them one-by-one, in the time that you have left. Check off as many questions as you possibly can. Study selectively.
How to do equity research
1. You are several months away from buying the stock. Go through all the financial documents, field studies, management interviews and newspaper articles. Create a detailed financial model to factor-in all the inputs. Identify the main drivers of valuation. Cover everything. Research exhaustively.
2. You are only a few days away from buying the stock. Read the latest financial statements, notes to accounts, stock exchange filings and news items. Identify the most likely sources of safety and danger. Narrow down the numbers of issues you must examine. Research these issues one-by-one in the time that you have left. Check off as many questions as you possibly can. Research selectively.