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February 15, 2011
October 16, 2010
Margin of safety
- “Margin of safety (financial)”: Wikipedia
- “Ben Graham’s Margin of Safety”: World Financial Blog
- “Count on the Margin of Safety”: Columbia University
October 3, 2010
September 15, 2010
One Up On Wall Street
- Buy what you know: Gain an advantage by investing in industries and companies you know and understand.
- Diworsification: Adding poorly understood investments, often at high prices, that reduce the average return of the portfolio or company.
- Categorize your portfolio: Slow growers, stalwarts, fast growers, cyclicals, turnarounds and asset plays
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The Essays of Warren Buffett: Lessons for Corporate America
- Invest in durable franchises with predictable earnings and high quality management. Buy at a reasonable price.
- Concentrated positions: invest like you have a punchcard allowing only 20 investments in your lifetime.
- Look through earnings: operating earnings + retained operating earnings – tax allowance target 15% growth
Stocks for the Long Run
- Stock market returns: From 1802 – 2002 the avg after-inflation return of stocks is 6.8% per year. This is higher than all other asset classes.
- Inflation: Stocks offer superior protection against inflation than bonds and many other asset classes.
- High Price Earnings Ratio: Stocks with high P-E ratios outperform stocks with low P-E ratios. Above 16 may be considered high.
- Noisy market hypothesis: Liquidity events effect prices. Fundamental info is not always reflected in the prices.
August 24, 2010
Common Stocks and Uncommon Profits
- Scuttelbutt: a method of using the business “grapevine” to assess a companies strengths & weaknesses.
- 15 Points: use a check list of qualitative factors to analyze a potential investment.
- Quality: Look for incredible companies that can generate above average profits.