General Thoughts

Value Line Weekend and Searching for Ideas

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I spent a lot of time going through Value Line yesterday looking for ideas. I like Value Line for the weekly screens they provide, and I also like paging through the stocks one by one. Anyone can pull up a screen of the cheapest stocks by P/E, P/B, etc…, but there is something more enjoyable about flipping through actual pages of paper (I do the same with 10-K’s and annual reports: much more enjoyable to read a hard copy than […]

How to Improve Results

Invert, Always Invert: Where do Investment Returns Come From?

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Yesterday I wrote a post that started with a quote that Charlie Munger has often used: “Invert, Always Invert.” The idea is to think differently than the crowd. Ben Graham said that our results are based on our methods, not whether the crowd agrees with us or not. However, the structure of the market is such that thinking in a contrarian way often leads us to areas that offer greater investment results. I believe that contrarianism is a necessary, but […]

Ben Graham

Invert, Always Invert: More on Thinking Differently

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“Invert, Always Invert.” -Carl Gustav Jacob Jacobi, 19th century mathematician, using the phrase to describe how he thought many problems in math could be solved by looking at the inverse. Charlie Munger often uses this same quote to express how investors can likewise benefit by looking at the inverse, or opposite, of what others are looking at.  Yesterday I wrote a post on Buffett and how he achieved 50% returns, and “guaranteed” that he could replicate those returns on a […]

Ben Graham

Some Thoughts on My Investment Approach

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I’ve been having numerous email conversations with readers about my investment philosophy and overall approach to investing. To understand my investment philosophy, you have to first understand the basic investment principles from the four investors who I’ve learned the most from: Ben Graham, Walter Schloss, Joel Greenblatt, and Warren Buffett. My investment approach is a confluence of ideas that primarily stem from those four investors. Graham is the foundation. Schloss and Greenblatt add important ideas and strategies to Graham’s foundation. Buffett […]

Investment Philosophy

Focus Your Time on Valuation, Not Prediction

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“An astute investor whose abilities we highly respect has observed that stock prices are much more volatile than the businesses whose ownership they represent. Thus, well established profitable businesses tend to be stable, consistent, even surprisingly predictable, and are capable of withstanding periods of adversity without lasting damage. In contrast, stock prices are uncertain, variable, capricious, unpredictable and highly responsive to short term transient influences. It is ironic that so many investors devote so much effort to the exceptionally demanding challenge of predicting these volatile […]

Investment Quotes

Video of 92-Year Old Walter Schloss Discussing his Investment Philosophy

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I was listening to a video on Walter Schloss last night. It was a Q&A with Schloss himself at the Ben Graham Centre for Value Investing at the University of Western Ontario. As some readers have probably noticed, I’m a big fan of Walter Schloss, who’s one of the greatest investors of all time. Schloss passed away last year at the age of 96, and this video was taken 5 years ago when Schloss was 92. Schloss comes off as […]

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

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 […]

Ben Graham

Video Tribute to Ben Graham

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I came across a video on Ben Graham over the weekend that was put together by the Heilbrunn Center at Columbia Business School. The Heilbrunn Center website is itself a great source for value investing, and they did a great job with this video. It’s about 15 minutes long and is filled with short interview highlights with heavy hitter investors such as Warren Buffett, Irving Kahn, and Edwin Schloss (Walter Schloss’ son and investment partner) to name a few. The […]