Value Investing

This category contains 106 posts

Kevin O’Leary on Money and Investing

I happened to come across an interview with Kevin O’Leary (of Shark Tank fame) on YouTube, and started to jot down some of his comments on investing and personal finance. O’Leary is an advocate of investing in cash flow paying (dividends or interest) securities, as opposed to growth stocks that pay no dividends. One main … Continue reading

Job Description for Buffett’s Successor

When I was reading what Seth Klarman looks for when hiring analysts (for my previous post), it mentioned Warren Buffett’s job description for his successor on the investment side. That was revealed in Berkshire Hathaway’s annual letter in March 2007. Here’s some key characteristics for the person: Smart people with impressive records But there is far more … Continue reading

Seth Klarman on Baupost Group’s Edge

I came across this compilation of quotes from Seth Klarman: The Collected Wisdom of Seth Klarman. Wanted to just capture some of those that speaks more to me. While writing this post, I came across this 2009 interview that Klarman did with TIFF that is pretty good, and have captured some of its points below. … Continue reading

Book Review of What I Learned Losing a Million Dollars by Jim Paul and Brendan Moynihan

This book writes about how Jim Paul got into Wall Street, rapidly became very successful, and then lost more than a million dollars in a soybean-oil spread trade. In the process to learn from this mistake, he realized that there are lots of different, and contradictory ways to make money,  but all the successful investors/traders … Continue reading

Book Review of Global Value: How to Spot Bubbles, Avoid Market Crashes, and Earn Big Returns in the Stock Market by Meb Faber

The full title of this book is Global Value: How to Spot Bubbles, Avoid Market Crashes, and Earn Big Returns in the Stock Market by Meb Faber (2014). This is a large, thin book, coming in at around 70 pages with large font size and good spacing. As a number of other book reviewers have commented, … Continue reading

Incorporate Macroeconomic Conditions in Value Investing

Came across two video snippets of an interview with Howard Marks from Oaktree Capital Management. Buffett had famously shared that he doesn’t consider macroeconomics when making his investment decisions. Howard Marks in the videos however advocated keeping tabs on the “market’s temperature” and adjusting one’s aggressiveness based on that. Why You Should Look at Macroeconomics It … Continue reading

Notes from Martin Whitman’s Interview with Wealthtrack.com

Just watched a video of an interview with Martin Whitman by Wealthtrack.com (link here). The interview was originally broadcasted on October 24, 2013. Conventional Approach Over-Emphasizes Four Things Earnings Short-term Top-down analysis Efficient market Martin Whitman’s Investment Criteria Don’t acquire common stock unless the company has a super strong financial position. Don’t invest in common … Continue reading

Book Review of Navigate the Noise by Richard Bernstein

The full title of this book is Navigate the Noise: Investing in the New Age of Media and Hype by Richard Bernstein (2001). Richard Bernstein was Chief U.S. Strategist at Merrill Lynch. I got to know about this book after I saw some of the old pieces from Bernstein while he was at Merrill, and googled … Continue reading

Premises of Investment and Trading Strategies

There are many ways to make money (and lose money) in the markets. I wanted to summarize the big buckets of investment / trading strategies out there, their premises (i.e. their underlying thinking about the markets) which drive how various people approach the markets. It is not always the case that the strategy one uses falls … Continue reading

Warren Buffett’s Investing Advice for the Non-Professional

I ended my last post with quotes from Warren Buffett’s latest annual letter to Berkshire’s shareholders. I figured its better to put them in a separate post here. HOW BUFFETT INVESTS Estimate Long-Term Earnings, Buy with a Margin of Safety When Charlie and I buy stocks – which we think of as small portions of … Continue reading

Book Review of Worry-Free Investing by Zvi Bodie and Michael Clowes

The full title of this book is Worry-Free Investing: A Safe Approach to Achieving Your Lifetime Financial Goals by Zvi Bodie and Michael J. Clowes (2003). Zvi Bodie is a very famous finance professor and co-author of a widely used textbook Investments. Michael Clowes is Editorial Director of Investment News and of Pensions and Investments. Normally I would skip … Continue reading

Book Review of How to Make a Million — Slowly by John Lee

The full title of this book is How to Make a Million — Slowly: My Guiding Principles from a Lifetime of Successful Investing by John Lee. John Lee, or Lord Lee of Trafford, wrote the My Portfolio column in the Financial Times for 14 years. He was a Conservative MP for Nelson and Colne from 1979 to … Continue reading

Book Review of The Emotionally Intelligent Investor by Ravee Mehta

The full title of this book is The Emotionally Intelligent Investor: How Self-Awareness, Empathy and Intuition Drive Performance by Ravee Mehta. According to the bio in the book, Ravee previously held positions at Soros Fund Management and Donaldson, Lufkin & Jenrette. He was a managing director for 8 years at Karsch Capital Management, before becoming a … Continue reading

Kyle Bass’ Views on Japan and the Beauty of Convex Bets

I viewed Kyle Bass’ presentation at the Strategic Investment Conference 2013 on his Japan thesis (link here).  He has quite a number of similar posts on Japan on his blog, and has publicly shared his views since 2012. Part of his thesis has played out very nicely as the Yen topped out in October 2011 … Continue reading

Inflation Adjusted DJIA and Secular Stock Market Cycles

I was looking for websites that show inflation adjusted U.S. stock indices, and came across this one that supposedly updates once a quarter (link here) [if anyone knows of such a website that updates frequently, do let me know!]. This one showed a comparison of the inflation-adjusted DJIA starting from year 2000 with the secular bear … Continue reading

Important SEC Filings for Fundamental Research

Just wanted to list down the few key SEC filings used for fundamental research into companies. Insider Transactions and Holdings Rule Every director, officer or owner of more than 10% of a class of registered equity securities needs to file Forms 3, 4, and 5. Form 3 Initial filing (e.g. IPO). Form 4 Filing before … Continue reading

Interview by Donald Yacktman with Gurufocus

I recently came across this interview by famous value investor Donald Yacktman with Gurufocus here. Just wanted to note down some learnings from the interview. Company Analysis Process Look at the cash flows of a company. Two components Payout through dividends and net share repurchases Return on retained earnings (this is the wildcard) What a company … Continue reading

Book Review of Unexpected Returns by Ed Easterling

The full title of this book is “Unexpected Returns: Understanding Secular Stock Market Cycles” by Ed Easterling. How I came across this book in the first place was when I was looking into the relationship between stock market returns and a number of other factors, such as interest rates, inflation, earnings, dividend yield, unemployment, GDP, … Continue reading

Value Investing Philosophy of Ron Burkle

I recently came across a Bloomberg BusinessWeek article on Ron Burkle, a billionaire that wanted to take over Barnes & Noble. The link to the article is here. He seems to be a private equity-type investor with similarities to Warren Buffett. He likes to take controlling stakes in private companies and makes money by flipping … Continue reading

Why High Return on Invested Capital is More Important than How Large the Business can Grow

I just published my book review on “It’s Earnings That Count: Finding Stocks with Earnings Power for Long-Term Profits” by Hewitt Heiserman, Jr. The book contained a very interesting quote from Buffett that answered a question that was lingering in my mind for some time. One of the things I didn’t fully understand was, what’s … Continue reading

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