People familiar with the teachings of Warren Buffett may be unaware of his mentor, Benjamin Graham (1894-1976). Buffett attributes a significant part of his investment success to the lessons he learned from his friend and mentor. Show More
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Investors continue to use technology companies as a proxy for risk, but we need to consider the value of individual stocks in the sector. As we survey the recent sell off in US tech outside our portfolio, we believe many of the share price falls are justified by company valuations.... Show More
Earlier this year I reviewed my top ten investment books of all time on Livewire. My goal was to share some of the perspectives of the world’s best investors. In this wire, I summarise those reviews to identify the top five characteristics of the world's best investors, the 'Super investors'. Show More
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At around $1.9 trillion Australian dollars, the Australian equity market is a minnow by global standards. It represents roughly 2% of global equity markets. Said another way, by only owning Australian shares, you are missing 98% of the world's investment opportunities. Show More
Guy Spier may not be as famous as some of the other investors I have reviewed over the last 10 days. However, he has managed to deliver an enviable track record since founding the Aquamarine Fund in 1997. Since inception to the date of publication, the Aquamarine Fund returned 463... Show More
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“I came to the psychology of human misjudgement almost against my will; I rejected it until I realised that my attitude was costing me a lot of money, and reduced my ability to help everything I loved” – Charles Munger Show More
Seth Klarman is widely recognised as one of the greatest value investors of all time. He is CEO and Portfolio Manager of the Baupost Group, a hedge fund managing over US$31 billion. His book, Margin of Safety is a value investors’ classic. Klarman practically explains the philosophy of value investing... Show More
Howard Marks is the Chairman and Founder of Oaktree Capital Management, an investment firm managing over $120B. This is not a how to invest book and you will not find any step by step instruction. When it comes to investing, Marks believes there is no sure-fire recipe for success. This... Show More
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Long before the term disruption was popularised by Silicon Valley, high quality business managers have been alert to the existence of change. In fact, Joseph A. Schumpeter, in Capitalism, Socialism and Democracy noted; Show More
Today I review the investment classic authored by Christopher Browne, ‘The Little Book of Value Investing’. Browne was a partner at Tweedy, Browne Company – the oldest value investing house on Wall Street. Again, I recommend reading the book in its entirety. However, here are my favourite chapters. Show More
Originally published in 1955, The Great Crash 1929, provides a timeless reminder of the economic consequences of financial speculation, excess leverage, and herding. Many parallels can be drawn between The Great Crash of 1929 and the Global Financial Crisis of 2008. There are moments in this book where you may... Show More
Warren Buffett once described himself as being 85% Ben Graham and 15% Phil Fisher. If Ben Graham is the father of value investing, Phil Fisher is the father of growth investing. The primary difference between the two philosophies is clear. Ben Graham’s investments tend to benefit from a one-time profit.... Show More
I wanted to change up the pace, from looking for cheap companies, to looking for expensive companies. Welcome to book number 9 in my top 10 investment books of all time, “The Art of Short Selling”. This book has been written by Kathryn Staley. Kathryn is an expert in the... Show More
Over the next ten days, I will review and post my top 10 investing books of all time - starting with number 10. I hope you enjoy the reviews and they provide you with some new perspectives that improve your investing. This book is a must read for any keen... Show More
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Starbucks is an American coffee company founded in Seattle in 1971. The company operates 27,339 locations across the world. Starbucks serves an assortment of hot and cold beverages, pre-packaged food, and snacks. Following a sustained period of above average growth, Starbucks is experiencing a slow down in comparable store sales... Show More
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We are often surprised that retail investors with whom we speak, are blissfully unaware of the risks involved in owning hybrids. ASIC and the banks have done a great job disclosing the risks, however, the message does not seem to be relayed effectively by financial intermediaries. We hope this note... Show More
I hope to enlighten potential investors about the tricks used by fund managers to ‘window dress’ their performance. Some of these tricks can be backed out and where possible I have provided the math below. Show More
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The ‘Dotcom’ crash of 2001 was a good old fashioned bubble. Many people were swept up in the euphoria as their expectations about future profits turned out to be nothing more than unfounded hope. For many Australians, it is a case of once bitten, twice shy. Roll forward 17 years,... Show More
Just a sensor stitched into a shirt? Well, not quite. Catapult provides sophisticated analysis to help understand player load with a view to preventing soft tissue injury. The technology also assists team management understand their players bio-mechanics in an objective way. The real smarts are in the algorithms that process... Show More
Over the next few years we expect a transitory period where the economy rebalances and new industries take up the slack from the subsiding mining boom. Government can assist this transition a little, and they can damage this transition a little – however the primary driver will be the ingenuity... Show More
Hi David. With respect to Wells Fargo, this analysis assumes Wells Fargo pays the same net profit in 10 years’ time – a conservative assumption as its profits will most certainly be higher as the business grows. Wells Fargo produced net profit of $8.057B in 2007, this year it is on track to produce $21.1B in net profit. This period includes the global financial crisis which Wells Fargo weathered. Incidentally, the business was founded in 1852, 166 years ago so I think it is fair to expect it to be around for another 10 years. The return on the bond is fixed as long as it is held to maturity. If you buy a 10 year bond today at a par value of $100 with a 3% coupon, you will receive 10 x $3 coupon payments and you will get $100 back at maturity.
Hi Damien. I think we could. We need our politicians to create a law that the company (acting on behalf of its shareholders) can claw back any entitlements i.e. salary or bonus, for unscrupulous behaviour. I think that would produce a positive change.
@Sam Femis. Well said.
On Book Number 1 - The Education of a Value Investor by Guy Spier -
Thanks for the support Nathan and Ivan. I'm happy you enjoyed them.
Great note Wayne - thanks for sharing.
@Michael, a very good point. Thanks for sharing.
On The dirty secrets fund managers don’t want you to know! -
@Adrian Thanks for your question Adrian. You raise an important point. Best practice is to accrue the performance fee daily, crystallise annually (subject to beating index) and apply a high water mark. The accrual ensures new investors aren’t being penalised for prior performance. This is important. However, it doesn’t help existing unit holders, who would have still paid a fee in my example.
On The dirty secrets fund managers don’t want you to know! -