Investment Philosophy

Value Investing: Luck vs Skill Part 2

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Earlier this week I responded to a comment that centered around the role of luck in long term outperformance. Feel free to read my response to the comment in Part 1 of this post where I list the #1 main reason why most people don’t replicate the results of Walter Schloss. It’s a very simple reason demonstrated by the results of Schloss himself. Today, I’ll discuss luck in Part 2 of this post. Does Luck Play a Role in Great […]

General Thoughts

Can George Soros’ Methods Be Replicated?

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I received this comment on one of my recent posts. The George Soros question got me thinking about how interesting the different philosophies are. Soros had an incredible career, but is it possible to replicate his general strategy? Here is the basic comment from the reader: Your posts have given me a great deal of information.  What is your opinion on George Soros’ theory of reflexivity? I was reading Seth Klarman’s Margin of Safety, and it mentioned how in rare […]

Motivational

Who is Walter Schloss?

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Everybody has heard of Buffett. Every value investor knows Graham. But Walter Schloss is a man that for most of his life, despite putting up one of the all time great track records, spent most of his life under the radar. I suspect he liked it that way. Many value investors have extensively studied Schloss and his methods, but there are still many who have not heard of him, or haven’t read much about him. Schloss passed away last year […]

Portfolio Management

Warren Buffett on How He’d Invest Small Sums of Money

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Warren Buffett has spent the last few decades looking to buy either entire businesses, or major positions in large cap stocks of great businesses. He looks to buy these businesses at low prices of course, but often times he pays a price that leave many value investors scratching their heads (i.e. paying over 20 times earnings for Heinz, and 20% more than the stock’s all time high). Much of the reasoning behind these types of investments has to do with […]

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 […]

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

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 […]

Investment Philosophy

The Value Portfolios I Track

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The market has been on a tear, similar to the start it got last January in 2012. The problem is that we’re 16% higher than last January, and valuations are stretched, making life difficult for investors who focus on finding bargains. However, I don’t believe the market is extremely overvalued… at least I’m finding some investment ideas in smaller stocks, and there are still enough cheap stocks out there to allocate some, if not all, of your capital. Of course, […]