Investment Philosophy

Martin Whitman: Focus on the Balance Sheet

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I spent the weekend in a cabin in the Catskill Mountains in New York. In between hikes I spent a lot of time by the fire reading old shareholder letters by Martin Whitman of Third Avenue Management. Whitman is a legendary value investor, and his letters are an incredible source of learning about general value investment principles. It’s also a great opportunity (as other fund manager letters are) to see what individual stocks they are invested in, and more importantly, […]

General Thoughts

On the Importance of Long Term Thinking

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One of the things I’ve been thinking about over the past few days is how important it is as an investor to engage in patient, long-term thinking. Most of us are either individual investors managing our own portfolios or maybe small professional managers like myself with a few like minded partners/investors. The edge we have over larger and better equipped institutions cannot be understated. Our edge lies in our ability to be able to think, and more importantly act, with […]

Investment Philosophy

More Notes & Articles on Allan Mecham of Arlington Value, “The 400% Man”

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Last week I wrote a post summarizing some of my thoughts on a Smart Money piece called “The 400% Man” that came out about a year ago. The piece dramatically increased the popularity of a small town, small-time (small meaning assets under management, not returns) hedge fund manager named Allan Mecham of Arlington Value Management. I think Mecham now manages a few hundred million in his fund, but before last year he was managing around $80 million. He started his […]

Investment Philosophy

The 400% Man-A Lesson for Aspiring Investors

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This afternoon I came across an article from Smart Money that is about a year old. I read it for the first time today, and it was one of those  pieces that you bookmark for reading again later. The piece was called “The 400% Man“, and had the intro tag line: “How a college dropout at a tiny Utah fund beat Wall Street, and why most managers are scared to copy him.” The article provides a great background into a […]

Investment Philosophy

Mohnish Pabrai-Thoughts on Growth & Similarities to Buffett

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I just read an article on Mohnish Pabrai by a magazine called Outlook India. Pabrai is one of my favorite investors to watch and learn from. He has a logical, simplistic way of explaining things, and he has built his entire investment business around what he calls “cloning”. He says that an investor would dramatically improve their results if they simply copied what Buffett does. Research papers have in fact backed this up as true; one paper calculated the returns of Buffett’s stock […]

Ben Graham

Value vs. Growth Investing-Which Method is Best?

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As an investor who studies in great detail the strategies and investment philosophies of the great value investors, I have always been intrigued by the debate of value vs. growth. I just wrote this post on qualitative vs. quantitative analysis. The discussion between growth and value is similar: the best growth investors are good business analysts… they have to be. It’s easy to find a company that’s growing, but the hard part is determining if that company will continue to […]

General Thoughts

Quantitative vs Qualitative Methods for Stock Analysis

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There has always been an ongoing debate about the pros and cons of quantitative and qualitative methods for picking stocks. Which way works better? Is one better than the other? Should an investor use both “quant” and “qual” factors when making investment decisions? I’m not sure… but I’ll give you my opinion. Two of the investors that I’ve learned the most from had completely different viewpoints on these two schools of thought. Ben Graham was a quantitative analyst, choosing only […]

Ben Graham

Ben Graham’s 4 Rules for the Defensive Investor

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“All knowledge is cumulative.” -Mohnish Pabrai The other day I was driving around listening to Ben Graham’s The Intelligent Investor “book on CD” that I received as a gift last year. I first read The Intelligent Investor 7 years ago, and it changed the way I think about investing, as it does for many others who read it for the first time. I’ve read the book twice, but I’ve listened to the CD about six or seven times since getting it last fall. There […]

Investment Philosophy

Tweedy Brown-Reasons to Own Dividend Stocks

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Did some studying on some Tweedy Brown material today… Tweedy Brown is a famous Wall Street value investing firm. It started as a brokerage (they were Ben Graham’s and Warren Buffett’s broker at one time). The brokerage was influenced heavily by Graham, and subsequently Buffett, and eventually started their own money management business, which became extremely successful. The firm managed hedge funds and mutual funds. They have four mutual funds focused on value investing. One specifically is focused on dividend […]

Ben Graham

Warren Buffett & Ben Graham on Diversification & Investment Philosophy Differences

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“Interesting possibilities abound on the financial scene, and the intelligent and enterprising investor should be able to find both enjoyment and profit in this three-ring circus. Excitement is guaranteed.” –Ben Graham, from the postscript of The Intelligent Investor.  I was listening to the tribute video that came out a few days ago on Ben Graham. It’s a great video put together by Columbia Business School, and I highly recommend taking a listen to it. In it, the producers interview Warren […]