I’m taking two weeks off. I’ll be in Pasadena, CA at the Value Investing Congress on May 4 and 5, and the Wesco Financial Corp. (AMEX:WSC) 2010 annual meeting on May 5. If you’d like to catch up, please drop me an email to greenbackd [at] gmail. I’ll be back Monday, May 17, 2010.
Archive for April, 2010
VIC and Mungerfest 2010
Posted in About, Greenbackd, Stocks, tagged Greenbackd on April 30, 2010 | Leave a Comment »
Dover Motorsports Inc (NYSE:DVD) and Mario Cibelli’s 13D amendment
Posted in Activist Investors, Stocks, tagged Activist investment, Dover Motorsports Inc (NYSE:DVD), Liquidation Value, Value Investment on April 29, 2010 | 2 Comments »
Mario Cibelli’s recent 13D amendment for Dover Motorsports Inc (NYSE:DVD) is interesting reading. Cibelli controls around 17.5% of DVD through Marathon Partners and Cibelli Capital Management. His most recent 13D amendment filed Wednesday annexes a letter setting out a (huge) case study of DVD “partly as a contribution to public education but also to obtain [...]
Kelly theory of portfolio construction: Do not bet thy whole wad
Posted in About, Stocks, Value Investment, tagged portfolio construction, Warren Buffett on April 28, 2010 | 2 Comments »
Portfolio construction and position sizing are key elements in investing. For every investor, there exists a tension between the desire to maximize the rate of growth of the portfolio while simultaneously minimizing the chance of blowing up. The Kelly Criterion is the method to determine the optimal portion of the portfolio to be invested in any given [...]
ROIC and reversion to the mean: Part 3
Posted in About, Behavioral economics, Contrarian investment, Net Current Asset Value, Net Quick Stocks, Net Quick Value, Stocks, Value Investment, tagged Mean reversion, Value Investment on April 27, 2010 | Leave a Comment »
Recently I’ve been discussing Michael Mauboussin’s December 2007 Mauboussin on Strategy, “Death, Taxes, and Reversion to the Mean; ROIC Patterns: Luck, Persistence, and What to Do About It,” (.pdf) about Mauboussin’s research on the tendency of return on invested capital (ROIC) to revert to the mean (See Part 1 and Part 2). Mauboussin’s report has significant [...]
Grantham on the potential disadvantages of Graham-and-Dodd investing
Posted in About, Stocks, Value Investment, tagged Value investing, Value Investment on April 26, 2010 | 11 Comments »
Jeremy Grantham’s 2010 first quarter investor letter (.pdf) appends the first part of a speech he gave at the Annual Benjamin Graham and David Dodd Breakfast at Columbia University in October last year. The speech was titled Friends and Romans, I come to tease Graham and Dodd, not to praise them. In it Grantham discussed the “potential [...]
One for the annals of behavioral finance
Posted in About, Behavioral economics, Value Investment, tagged Behavioral investing, Value investing on April 23, 2010 | 1 Comment »
Oh dear (Daily Reckoning via Guru Focus): 04/21/10 Gaithersburg, Maryland – Ken Heebner’s CGM Focus Fund was the best US stock fund of the past decade. It rose 18% a year, beating its nearest rival by more than three percentage points. Yet according to research by Morningstar, the typical investor in the fund lost 11% [...]
ROIC and reversion to the mean: Part 2
Posted in About, Stocks, Value Investment, tagged Mean reversion, ROIC, Value Investment on April 22, 2010 | 3 Comments »
Yesterday I discussed Michael Mauboussin’s December 2007 Mauboussin on Strategy, “Death, Taxes, and Reversion to the Mean; ROIC Patterns: Luck, Persistence, and What to Do About It,” (.pdf) about Mauboussin’s research on the tendency of return on invested capital (ROIC) to revert to the mean. Mauboussin’s report has three broad conclusions, with significant implications for modelling: [...]
ROIC and reversion to the mean: Part 1
Posted in About, Stocks, Value Investment, tagged Mean reversion, Value Investment on April 21, 2010 | 7 Comments »
In Michael Mauboussin’s December 2007 Mauboussin on Strategy, “Death, Taxes, and Reversion to the Mean; ROIC Patterns: Luck, Persistence, and What to Do About It,” (.pdf) Mauboussin provides a tour de force of data on the tendency of return on invested capital (ROIC) to revert to the mean. Much of my investing to date has been based [...]
AAPL: Trade of the decade?
Posted in About, Contrarian investment, Stocks, Value Investment, tagged Apple Inc. (NASDAQ:AAPL) on April 20, 2010 | 1 Comment »
On October 25, 2001, Apple Inc. (Public, NASDAQ:AAPL) traded at a (split-adjusted) $9.15 per share. Fast-forward to yesterday’s close, and AAPL is a $247.01 stock. For those keeping score at home, that’s a lazy 2,600% in 8 1/2 years, or around 47% p.a. compound. And with a starting market capitalization of $5B, anyone could have [...]
Return of big LBOs
Posted in About, Stocks, tagged Darwin's darlings on April 19, 2010 | Leave a Comment »
Reuters Breakingviews has an article, Big Leveraged Buyouts May Soon Make a Comeback (via NYTimes.com), on the potential for a return of big LBOs. Breakingviews attributes the possibility to the availability of capital: The money certainly has become available. In addition to dry powder held by the biggest private equity firms, banks are eager to lend again [...]
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