In the process of investment, it is important to select excellent companies, and in the process of selecting enterprises, it is inevitable to use industry analysis, and more often than not, the analysis of the industry is more important than the analysis of the enterprise itself.
Warren Buffett once said that between a good manager and a declining industry, it is often the latter that wins.
This is also what we often say, don't wrestle with a pig, even if you win it, it's only a little better than a pig.
So in the process of analyzing the industry, we will inevitably involve the analysis between industries, let's take a look at the upstream and downstream relationship of the industry. As shown below:
This diagram can roughly delineate the upstream and downstream relationship of the industry, of course, it is not comprehensive, but we can learn from it.
When analyzing the industry, starting from a certain industry, the industry will definitely have great development, then its upstream will inevitably get more demand, and there will be better development.
And vice versa, if we analyze many industries according to this logic, it is good to judge whether we can invest.
For example, we know very clearly that the future development of the pharmaceutical industry will be very rapid, so the upstream of the pharmaceutical industry will inevitably benefit from this, and what is the upstream of the pharmaceutical industry?
There are raw materials, equipment, basic chemicals, and so on. It is almost certain that these industries will thrive for a while.
In the process of investment, the most important thing is certainty, which industries have the strongest certainty, this is a fulcrum, from this fulcrum to analyze its related industries. Chang Meng main investment