"The goal of any long-term investor should be to have the greatest understanding of the underlying economics of a business and know how those can change."

After you've decided you want to learn more about a business, the real work begins.

• Study the industry - What has caused its growth over the last 20-25 years?

• Study the company - Read the 10-K, 10-Q, annual reports, analyst reports.

• Study the customer - Who are they? What value do they receive?

"Ideally, you should research the business as though you would be taking over the business in the next few months as chief executive officer (CEO)."

*Notes taken from "The Investment Checklist" by Michael Shearn -Question 2 of "Understanding the Business - The Basics."