Two Important Investment Principles

Posted on 8 CommentsPosted in Investment Philosophy, Portfolio Management

I was recently reading through some old investor interviews from the excellent Graham and Doddsville newsletter from Columbia Business School, and I came across an interview from Glenn Greenberg of Brave Warrior (formerly Chieftain Capital). A couple years ago I commented on a talk that Glenn Greenberg did at Columbia, where he discussed his investment approach. My own investment approach tends to fall in line with Greenberg’s investment philosophy as well as his portfolio management approach. Despite a few misses […]

A 1977 Warren Buffett Interview From the WSJ Archives

Posted on 5 CommentsPosted in Portfolio Management, Warren Buffett

Someone I’m connected with on Linkedin sent me this old article from 1977 in the Wall Street Journal on Warren Buffett. I thought I’d share it here, along with a few highlights. It’s an article I haven’t seen previously. There isn’t much new here, but I thought it was quick read with a couple passages worth commenting on. One thing I don’t recall Buffett ever describing were the pressures of money management that he felt while running his partnership. This […]

The Market Value Fluctuations of the 10 Largest Companies

Posted on 8 CommentsPosted in General Thoughts, Investment Philosophy, Overall Stock Market, Portfolio Management

I thought I’d put up a quick post with an interesting chart that might provide some food for thought. Considering the volatility in the past few days that was created by the surprising results of the “Brexit” referendum where the U.K. voted to leave the European Union, I thought this might be a timely topic to think about. In the past I’ve discussed how sometimes even the largest cap stocks can get mispriced from time to time (see here and […]

Unconventional Investments

Posted on 11 CommentsPosted in Portfolio Management, Shareholder Letters & Reports, Warren Buffett

I was glancing through the Berkshire letters from the late 1990’s because I recall Buffett briefly mentioning his large silver position he acquired and I was trying to see if Buffett referenced the specific cash cost of production. He didn’t in the letter—only mentioning that Berkshire acquired 111 million ounces. He has mentioned in other interviews that silver was in fact below the cost of production—a supply/demand imbalance that can persist for a while, but not forever. Buffett felt comfortable […]

Buffett on Taxes (1965 version)

Posted on 6 CommentsPosted in Investment Quotes, Portfolio Management, Warren Buffett

“One of my friends—a noted West Coast philosopher—maintains that a majority of life’s errors are caused by forgetting what one is really trying to do.” – Warren Buffett, 1965 BPL Partnership Letter I’ve read a few things lately discussing the benefits of designing a “tax-efficient” investment strategy. I’ve said this before, but I think there is a significant misunderstanding on the tax benefits of a low-turnover portfolio, and there is an even larger misunderstanding on the concept of turnover itself. […]

Drivers of ROE in the Context of Portfolio Management

Posted on 16 CommentsPosted in Portfolio Management, Think Differently, Warren Buffett

Someone on the Corner of Berkshire and Fairfax board recently posted this comment referencing Buffett’s well-known piece on inflation from 1977. In the article, Buffett describes the variables that drive a company’s return on equity. There are only five ways that a company can improve returns: Increase turnover Cheaper leverage (reduce interest charges) More leverage (increase the amount of assets relative to a given level of equity) Lower income taxes Wider margins Notice three of the five drivers of ROE have […]

Risk and Portfolio Management Similarities between Joel Greenblatt and Stanley Druckenmiller

Posted on 6 CommentsPosted in Case Studies, Investment Philosophy, Joel Greenblatt, Portfolio Management, Superinvestors

I have been busy over the past couple of weeks. My wife gave birth to twins about two weeks ago, and now that I am back in the office, I am catching up on some reading. While we were in the hospital for about a week, I did have some time to do some reading, and I have some comments on two annual reports of current holdings of mine—JP Morgan and Markel—which I may turn into brief posts. But briefly, […]

A Few Thoughts on Reducing Unforced Errors

Posted on 8 CommentsPosted in General Thoughts, Investment Philosophy, Portfolio Management

This weekend I came across a link to an excellent Manual of Ideas interview with Allan Mecham that I’ve read before, but I decided to read through it again. There are a few key points that Mecham brings up that I think are really worth repeating, so I thought I’d highlight them here. Investing is not easy, but it should be simplistic. Here are some points worth keeping in mind: Understand What You Are Buying The first is the concept of understanding a […]

Mohnish Pabrai: Think Differently to Achieve Different Results

Posted on 21 CommentsPosted in Mohnish Pabrai, Portfolio Management, Superinvestors, Think Differently

I recently came across two videos with Mohnish Pabrai. Readers here know that Mohnish is one of my favorite investors to listen to. He is extremely generous with his time, and he has a genuinely interested attitude toward his audience. You can tell that he truly enjoys teaching others about his investment experiences. Pabrai has given numerous lectures over the past year, and I wrote a summary of one that I thought was particularly interesting here. In that post, I […]

Buffett vs Munger vs Schloss and Thoughts on Portfolio Strategy

Posted on 34 CommentsPosted in How to Improve Results, Investment Philosophy, Portfolio Management, Superinvestors, Think Differently, Walter Schloss, Warren Buffett

I was having a conversation about Munger’s philosophy vs Schloss’ philosophy and had a few thoughts (and below I’ll compare their performance results against Buffett’s)… I often like to look at long term past performance of investors (10 years or longer) to draw conclusions about the effectiveness of their investment approach. I’ve often discussed on this site the many value investors out there with average returns. I used to ask myself ‘how can their returns be average when they clearly […]