Unverified List

An Unverified List is an investor's initial brainstorming roster… It's the raw, unfiltered collection of potential investment ideas before any serious homework has been done. Think of it as the casting call for your portfolio; you've invited everyone who looks interesting, but you haven't held any auditions yet. For a Value Investing practitioner, this list is the top of the investment Funnel, a wide-mouthed net designed to catch as many potential opportunities as possible. The companies on this list might have been found through a quick Stock Screener, mentioned in a newspaper article, or simply noticed during a shopping trip. The key characteristic is that they are unverified—you haven't yet dug into their financial statements, assessed their competitive advantages, or tried to calculate their Intrinsic Value. It's a crucial first step that separates the process of idea generation from the more rigorous process of analysis, ensuring a steady stream of possibilities without getting bogged down in the details too early.

Why bother with a list of half-baked ideas? The answer is simple: to systematize your search for gold. An Unverified List acts as a buffer against two common investor pitfalls: “analysis paralysis” (spending so much time on one company you miss others) and “idea drought” (having nothing new to look at). By separating the act of finding a company from researching it, you create an organized workflow. Your goal isn't to find a winner on day one. It's to build a rich hunting ground. This list is your personal inventory of curiosities, a collection of corporate stories waiting to be explored. It ensures that when you do sit down to do deep research, you have a menu of options to choose from, rather than staring at a blank screen wondering where the next great investment will come from.

Building your list is a creative and ongoing process. It's about keeping your eyes and ears open to the business world around you. There's no single “right” way, but here are some of the most effective methods used by legendary investors.

• Financial Screens: Use an online Stock Screener to filter thousands of public companies based on simple, broad criteria. You might look for companies with a low Price-to-Earnings Ratio, a high Return on Equity, or those trading near their 52-week lows. The goal isn't to find perfect companies, but to generate a manageable list of potentially cheap ones.
• Voracious Reading: As Charlie Munger advises, “Go to bed smarter than when you woke up.” Read everything: The Wall Street Journal, business magazines, industry trade journals, and even the local newspaper. A small article about a regional company struggling with a temporary, solvable problem could be the starting point for a fantastic investment.
• The “Scuttlebutt” Method: Popularized by Philip Fisher, this involves on-the-ground intelligence gathering. Talk to people! If you're looking at a retail company, visit its stores. Talk to employees (if appropriate), customers, and even suppliers. This qualitative research can uncover insights that numbers alone can't provide.
• Personal Observation: Peter Lynch was a master of this. Did you just discover a fantastic new product? Is a particular restaurant in your town always packed? These simple observations can be powerful starting points. You have an edge when you understand a product or service as a consumer first.
• Special Situations: Keep an eye out for corporate events like Spin-offs, mergers, or bankruptcies. These situations often cause market confusion and can lead to wonderful companies being sold at bargain prices because they are temporarily misunderstood or overlooked by institutional investors.
• Following the “Superinvestors”: Public filings, such as 13F Filings in the U.S., reveal the holdings of large investment funds. While you should never blindly copy another investor, seeing what masters like Warren Buffett are buying can be a great source of ideas for your own research.

Your Unverified List is a messy, beautiful thing, but you can't invest from it directly. The whole point is to move promising candidates from this raw list to a more refined “watchlist” for deeper analysis. This is where the real work—and the real value creation—begins.

Before you commit hours to a full analysis, run each company on your Unverified List through a quick 10-minute filter. The goal is to quickly discard the obvious non-starters. Ask yourself:

• Do I understand it? Does the business operate within my you've invited everyone who looks interesting, but you haven't held any auditions yet. For a [[Value Investing practitioner, this list is the top of the investment Funnel, a wide-mouthed net designed to catch as many potential opportunities as possible. The companies on this list might have been found through a quick Stock Screener, mentioned in a newspaper article, or simply noticed during a shopping trip. The key characteristic is that they are unverified—you haven't yet dug into their financial statements, assessed their competitive advantages, or tried to calculate their Intrinsic Value. It's a crucial first step that separates the process of idea generation from the more rigorous process of analysis, ensuring a steady stream of possibilities without getting bogged down in the details too early.

Why bother with a list of half-baked ideas? The answer is simple: to systematize your search for gold. An Unverified List acts as a buffer against two common investor pitfalls: “analysis paralysis” (spending so much time on one company that you miss others) and “idea drought” (having nothing new to look at). By separating the act of finding a company from researching it, you create an organized workflow. Your goal isn't to find a winner on day one. It's to build a rich hunting ground. This list is your personal inventory of curiosities, a collection of corporate stories waiting to be explored. It ensures that when you do sit down to do deep research, you have a menu of options to choose from, rather than staring at a blank screen wondering where the next great investment will come from.

Building your list is a creative and ongoing process. It's about keeping your eyes and ears open to the business world around you. There's no single “right” way, but here are some of the most effective methods used by legendary investors.

• Financial Screens: Use an online Stock Screener to filter thousands of public companies based on simple, broad criteria. You might look for companies with a low Price-to-Earnings Ratio, a high Return on Equity, or those trading near their 52-week lows. The goal isn't to find perfect companies, but to generate a manageable list of potentially cheap ones.
• Voracious Reading: As Charlie Munger advises, “Go to bed smarter than when you woke up.” Read everything: The Wall Street Journal, business magazines, industry trade journals, and even the local newspaper. A small article about a regional company struggling with a temporary, solvable problem could be the starting point for a fantastic investment.
• The “Scuttlebutt” Method: Popularized by Philip Fisher, this involves on-the-ground intelligence gathering. Talk to people! If you're looking at a retail company, visit its stores. Talk to employees (if appropriate), customers, and even suppliers. This qualitative research can uncover insights that numbers alone can't provide.
• Personal Observation: Peter Lynch was a master of this. Did you just discover a fantastic new product? Is a particular restaurant in your town always packed? These simple observations can be powerful starting points. You have an edge when you understand a product or service as a consumer first.
• Special Situations: Keep an eye out for corporate events like Spin-offs, mergers, or bankruptcies. These situations often cause market confusion and can lead to wonderful companies being sold at bargain prices because they are temporarily misunderstood or overlooked by institutional investors.
• Following the “Superinvestors”: Public filings, such as 13F Filings in the U.S., reveal the holdings of large investment funds. While you should never blindly copy another investor, seeing what masters like Warren Buffett are buying can be a great source of ideas for your own research.

Your Unverified List is a messy, beautiful thing, but you can't invest from it directly. The whole point is to move promising candidates from this raw list to a more refined “watchlist” for deeper analysis. This is where the real work—and the real value creation—begins.

Before you commit hours to a full analysis, run each company on your Unverified List through a quick 10-minute filter. The goal is to quickly discard the obvious non-starters. Ask yourself:

• Do I understand it? Does the business operate within my Circle of Competence? If you can't explain what the company does to a ten-year-old in a few sentences, it's probably best to move on.
• Are there glaring red flags? A quick look might reveal an overwhelming amount of debt, a history of scandals, or a business model that is clearly becoming obsolete.
• Does it pass the “sniff test”? Is revenue generally growing? Is the company profitable? You don't need a detailed spreadsheet at this stage, just a high-level check to see if the basic story makes sense.

The biggest mistake an investor can make is to confuse an unverified idea with a thoroughly researched investment. An idea from this list is just a ticket to the game, not a winning lottery ticket. Buying a stock simply because it appeared on a screen or because a famous investor owns it is speculation, not investing. The Unverified List is the starting pistol for your research race. The real prize is won by patiently doing the hard work of understanding the business, assessing its Management, and calculating a conservative estimate of its Intrinsic Value before ever clicking the “buy” button.