Financial Frameworks continues looking for ways to apply margin of safety when selecting investments by looking at Professor Bruce Greenwald's approach to value investing. Prof. Greenwald divides a company into three parts for valuation. He measures assets first, then current earnings and finally makes future growth estimeates separately. Today's podcast outlines Prof. Greenwald's thinking, the underlying logic and changes in markets that guide his thinking and suggests how you can apply his method. Because his future growth estimates is so interesting, and more detailed than Discounted Cash Flow projections - which we discussed earlier - I will spend the next podcast on the hows, and what I think are the why's of Prof. Greenwald process for estimating future growth a company's future growth. The context for my analysis is to build a margin of safety into investing. I may be being repetitive in reminding you of the context, but I don't think emphasizing margin of safety can be done often enough.

Additionally, in response to listener comments, the podcast considers why most people look at savings accounts and investing as different activities - more like a fork in the road than as different stores on the Main Street of investing - and why we shouldn't. That topic brings me to a review of our loss aversion bias as the podcast's final topic. Financial Frameworks focuses on being clear about our decisions and understanding our values. This discussion is part of that process.

As always, if you find this useful, please mention it to a colleague.

Mike Lehan