Value Investing Agent

See the Value, Pay the Price

"Price is what you pay. Value is what you get."

Understanding whether a stock is cheap requires more than looking at P/E ratios. True value is the present value of future cash flows a company can generate.

Most AI responds to "Is this company valuable?" with "It depends." Value Investing Agent gives you concrete numbers using Warren Buffett's 60-year investment discipline.

Carry the Oracle of Omaha's mind in your pocket.

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Why This Skill?

Wall Street wants to appear complex. Buffett believes in the power of simplicity.

This skill reduces every investment decision to 6 concrete steps:

1. Circle of Competence - Do I understand this business?
2. Owner Earnings - What's the real cash earnings?
3. Intrinsic Value - What's the company's true worth?
4. Moat Assessment - How strong is the competitive advantage?
5. Margin of Safety - How much protection do I have?
6. Position Sizing - How much should I invest?

"Rule #1: Never lose money. Rule #2: Never forget Rule #1."

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What's Under the Hood?

1. Owner Earnings Calculation

Warren Buffett's favorite metric. Not net income, but real cash-generating capacity:

Owner Earnings = Net Income + Depreciation - Maintenance CapEx - Working Capital Change

2. Intrinsic Value (DCF)

Present value of future cash flows. With Buffett's strict rules:

• Growth (Y1-5): Maximum 15%
• Growth (Y6-10): Maximum 10%
• Discount rate: Minimum 10%
• Terminal multiple: 15x for quality

3. Moat Scoring

Competitive advantage measurement across 10 criteria:

Score	Level	Position Potential
85%+	INEVITABLE	40-50%
70-84	FORMIDABLE	20-40%
55-69	STRONG	10-20%
<55	QUESTIONABLE	Watch only

4. Margin of Safety Analysis

Margin	Rating	Action
50%+	EXCELLENT	Strong buy
30-50%	GOOD	Buy
15-30%	FAIR	Consider if moat exceptional
0-15%	MINIMAL	Wait
<0%	OVERVALUED	Avoid

5. Position Sizing (Modified Kelly)

Position = (Expected Return / Loss Risk) × Conviction Factor × Safety (0.35)

6. Buffett Indicator

Total market cap / GDP ratio for market timing.

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Mental Models

This skill doesn't just calculate. It incorporates Buffett's thinking system:

Circle of Competence

"Can I predict this business 10 years from now?"

• YES → Continue analysis
• NO → "Too hard pile"

Mr. Market

The market is a manic-depressive partner offering you prices daily. Exploit his emotional swings, don't chase them.

Inversion

Ask "How could I lose money on this investment?" List the risks, then evaluate.

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Live Example: Apple Analysis

User: "Should I buy Apple stock?"

Value Investing Agent's Response Structure:

1. Circle of Competence: ✓ Consumer products, strong brand
2. Owner Earnings: $95 billion
3. Moat Score: 87% (INEVITABLE)
   • Ecosystem switching cost: 9/10
   • Brand strength: 9/10
   • Pricing power: 8/10
4. Intrinsic Value: $165/share
5. Current Price: $185/share
6. Margin of Safety: -12% (OVERVALUED)

Decision: "Wonderful company, but no margin of safety at current price. Add to watchlist, re-evaluate on 15-20% decline."

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How to Use

Don't bore this skill with simple questions. Ask it real investment decisions:

• "Calculate Apple's Owner Earnings and evaluate its moat score"
• "Calculate Coca-Cola's intrinsic value using the Buffett method"
• "Perform margin of safety analysis for Microsoft"
• "Size my portfolio position using the Kelly criterion"

Warning: This skill won't tell you "buy stock X." It provides the tools to answer "does buying stock X make sense?"

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Installation

1. Download the skill file
2. Place it in the ~/.claude/skills/ folder in Claude Desktop
3. Restart Claude

Note: To install skills, you need to use the claude.ai website or Claude Desktop application. Once installed, you can also use the skill through the mobile app.

Think like Warren Buffett. Buy businesses, not stock tickers.