Great video on how many families in Europe have approached investing. Totally 180 degrees to how things are done these days.
Indian stock market myths.
That research about Warren Buffett… I know which one that was. It was half-baked one intended to create media sensation. Warren Buffet’s major holdings (75%+) have been with him for longer than 5 years.
Most of the points are questionable
#1 ) One cannot make a determination on Buffett (or any investor for that matter) without looking at allocation. One can have 80% of one’s portfolio with a holding period of 10 years and churn a set of multiple stocks that comprise the rest 20%. One cannot make any deterministic comment on that investor’s holding period.
#2) The research also does not consider the fully owned and acquired companies which obviously are permanent holdings. Including them in the list makes the percentage allocation all the more skewed towards very long-term holdings.
#3) Myth 2, starts counting at the peak of the Harshad Mehta bull run, which skews the results. Also, most importantly, it does not consider dividends, which when compounded over 20-25 years ends up making a significant difference.
#4) Rotation and Buy-and-hold both approaches work. It depends on one’s time horizon. if one is investing generational funds, which means a time horizon of 50-100 years, then buy-and-hold for long durations will yield decent results. ROtation also works, provided one sells the right stock and enters another better stock. In sector rotation, multiple decisions need to be made correctly simultaneously. But doing it well is not impossible and can yield excellent results as well.
#5) You need to get both the right mutual fund (or a “good one”) and then get the duration in that. Being invested in a poor fund for a decade will not help
Also Coke has split its shares in 2012 @2:1. This has not been factored in.So actual price pre split would be 87
Mr. Amit took 1998 as his base case, when every investor in the US knew about Coco-Cola being overvalued. WB probably could have sold it then and bought it back later. For reasons we have no right to ask, he didn’t.
Second, he took the top of 1998 and compared it with today’s price (Red Circles), while completely ignoring the fact that Warren Buffet actually bought Coco-Cola in 1988, during a crash (Blue Circle):
The actual CAGR from his Coco-Cola investment is 11% for 30 years, while the S&P 500 returned around 10% during the same time, which still amounts to beating the market.
Here’s a very good article about how Warren Buffet’s investments have performed over the years: https://www.fortuneindia.com/investing/warren-buffetts-report-card/101623
The chart does not show the effect of stock split. Between 1998 and 2018, Coke was split 2:1 in 2012. So effectively one should double the current price for comparison.
Insolvency and Bankruptcy Code has definitely spurred a lot activity with some relatable action happening. Came across this article on similar subject. Need to look it from a point of view of how creditors (largely PSU banks) are can get affected by this.
Article - Bankruptcy law will spur M&A deals
thought provoking video by Dr @ckn on psychology.
While its on trading psychology, its equally applicable to investors
Very thought-provoking piece on the social aspect of network effects, and things like lectures vs sermons. I think it helps to understand why some ads/messaging really work or why being present physically makes things feel different - say in watching a movie with other people or a new years’ eve party and understanding the underpinnings of ceremonies in a wedding which has evolved differently in different cultures but is present to fulfil a common goal. If behaviour and psychology of societies and crowds interest you, read on.
Excellent market commentary by Bill Nygren
". the economy has become more asset-light, intangible assets—such as brand names, customer lists, R&D spending and patents—have become more important. Today, the relative importance of tangible assets compared to intangibles has completely flip-flopped from what it was 40 years ago. Intangibles now account for over 80% of the average company’s market value. But much like Graham, GAAP doesn’t even attempt to value those assets. "
Interesting nuggets of information on the CV space from an industry insider
A sneak peak into Elliot Management, the company which came to the notice of Indian investors, because of their activism in Cognizant Technology Services.
A very useful article on the different aspects of taking notes.
An interview of Joel Greenblatt
The risk of China in steel sector
A little bit of learning from and about David Einhorn. First an interview, followed by the problems that he faces these days.
Thanks for sharing. I especially liked the following paragraph in the einhorn interview.
“If we decide we were wrong about something, in terms of why we did it, we exit, period. We never invent new reasons to continue with a position when the original reasons are no longer available”
I think not inventing new reasons for holding on is something that takes some doing mentally and its quite difficult in practice. Nonetheless it underscores the importance of doing regular checks on your thesis.
India social revolution
some great pointers about current American economy
A Template for Understanding Big Debt Crises, available as a free PDF by Ray Dalio
Gary is a dear friend and an astute investor. He presented the following to the MBA class at the F. W. Olin Graduate School of Business:
I strongly suggest that you also check out his fund’s website and subscribe to it: