Hielko

I also consider a world wide equity benchmark as the most appropriate (MSCI World in euro's in my case) because that's probably what I would invest in if I wouldn't be an active investor. In practice I usually invest in companies that are way smaller than those in the benchmark, but I think I should get the blame/credit for the possible under/over performance of illiquid small caps vs large caps; it's an active decision from me to focus on those kind of assets.

What you are missing in your math is just a small detail: in the NAV calculation only the par value of the prefs is included, not the value of the option to convert. That the market reacted fairly significant to the conversion isn't very rational; that this would happen should/could have been known since the preferred were introduced. See for some more background this post on my blog that I wrote more than a year ago: http://alphavulture.com/2012/10/03/special-opportunities-fund-spe/

Can you explain this more? I've registered domain names with namecheap and godaddy, I don't think either used Verisign. Verisign operates the authoritative registry for .com and .net, so namecheap and godaddy have to go through Verisign.

Why are we talking about options in this thread? :/

I agree with this statement, but the material suggests that it shouldn't matter what the absolute level of the numbers is or continuous play. Really? I'm pretty sure that the people at the CFA Institute know what an utility function is.

You can often buy Greek stocks in Frankfurt/Germany. If it's not traded there you are out of luck with IB, but there are obviously plenty of other brokers that do offer direct access to Greece.

Easy, I go for the 25% chance for $400. It's totally irrelevant that this specific event is a one time deal, because you should have a huge amount of other decisions that you can make during a lifetime. Maximizing the EV of all your decisions will in the long run generate a far superior outcome than always going for the low variance, low EV option. The only reason to go for a low risk/low EV option is when the amount at risk is very substantial. If you would ask this question to someone in Malawi who's surviving on $10/month it's probably wise to go for the low EV option.... PS. I would only switch to scenario 2 if I would get paid $100 or more.

I don't Security Analysis and The Intelligent Investor are really difficult to understand nor read, and that's coming from someone who isn't a native English speaker. Especially The Intelligent Investor should be a quick read, and with your accounting background I think Security Analysis should be pretty easy as well. And I do think it's a smart move to start learning about investing. Sure, you aren't going to make a lot of money with your current capital base, but you are putting yourself in a way better spot as soon as you start making a significant amount of money. Compounding is a powerful force, and if you have to figure everything out after you have to money you probably lose a couple of years of compounding (or worse).

Assuming I understood the video correctly this kind of math is also used to explain the casimir effect, and other quantum mechanics related stuff. That's not theoretical physics anymore, but actually phenomena that have been measured and proven.

doesnt that mean that you have to pay that 35% monthly tax? Which in reality will be more like 40-50%. Which is extremly unreasonable with the amount of risk you take imo. Id pay like 20% at most really. You still play? I still play. The tax is 29% and it's indeed monthly, but I basically never have big losing months (obviously need to manage the risk w.r.t. the games I'm playing to achieve that result). But it doesn't really matter at this point, because it's nearly certain that I'll get back all the taxes I'm paying right now. So I expect that my effective tax rate will be 0%.

Do you really need a checklist to read the footnotes?

That is exactly why the B-shares were created... Buffett didn't like that people got screwed over by intermediaries. I also doubt how big the impact of ETF's is. People used to invest in mutual funds with high fees that were often closet indexers anyway. Now they simply pay a low fee, and there is no pretense of what they are buying. I do think that (some) small mutual funds are able to outperform, but I think that has always been the case.

I also bought Conduril at the ask price, and averaged up, and I do think that's a good example of when it makes sense to buy at the ask: extremely low liquidity, and a really good price. But even Conduril could have been bought cheaper, a decent block of stock changed hands at E20 share just days after I hit the ask @ E22.

Depends on what's out there though. I've limited above the offer on some illiquid stuff because after talking to a market maker I've learned there are a number of shares slightly higher that I can take out at once. Or I can coax someone into the stock by offering a higher price, if I offer the bid I'll never get shares. I'd rather have a position at a percent or two higher rather than have nothing in some cases. Sure, I sometimes buy at the ask as well, but two things to consider: 1. If you are indeed buying something that will go up 100% saving few pennies isn't important. While I usually think that the things I buy have that kind of potential the truth is that in reality that's usually not the case. I think for most people generating 5% alpha would be an impressive result. If you incur a couple percent trading costs when you buy and sell, and your average holding period is a year than almost all your possible outperformance disappears. Saving a couple percent can be very very significant I think. 2. How often do you buy something that only goes up after you bought it? Usually I get an opportunity to buy it cheaper, so you don't need to be in a rush to enter your position.

I usually try to buy at the bid, but it depends on the liquidity and how good the ask price is. I often buy stocks that have a limited liquidity and a wide bid/ask spread. Better to have a bit of patience so you don't have super high trading costs in those cases, and when you provide liquidity you can get a rebate on your transaction costs as well.

I guess you made your money playing poker? IANAL, and obviously don't know what laws apply to you, but there might be some options to get around paying taxes on your winnings. I'm Dutch, and I did pay gambling taxes on my winnings, but i'm probably getting a decent portion of that back because of European laws w.r.t double taxation. Since the poker sites (those location in the EU anyway) already paid European gambling taxes our government can't tax it again. Still needs to be confirmed by the supreme court in the Netherlands, but we already won this argument 4 times (two separate cases, and first at lower court and then at court of appeal).

Seems like it's time to find a loan: http://finance.yahoo.com/q/ks?s=EDS+Key+Statistics

That they were really undervalued. :) Totally possible, but how many simply followed the few great investors that really recognized this? Hypothetical; lets say you had a group of people who simply copied Buffett a couple of decades ago. They would have outperformed, and you probably should give them some credit for choosing to follow Buffett. But it would be really one guy that would have been the great investor, not the group of followers (imo). So how many great investors versus followers are there on this board?

You have to ask though how many independent samples there really are in the CoBF results (and the same can be said about the bogleheads performance). If almost everybody invests in AIG, BAC and a few other names, and those names outperform: what does it exactly say?

But you're basically picking the best performing benchmark of 2013. Most investors also allocate money to international equities and other asset classes such as bonds, commodities or real estate.

Yeah, I think it's important that you aren't short a crowded trade. The shorts are almost always right that the company is indeed overvalued, but when you pay a very high borrow fee and face other risks such as a squeeze or a buy-in it's hard to make money. I look at the borrowing costs to see if the trade is too crowded or not. Borrowing CRM is very cheap with a 0.17% rate at IB, so it's not a crowded trade. VEEV and TXTR are a bit more crowded with a 1.24% and 2.30% rate; but that's imo still manageable (I'm short all three names). Given how large these names are I'm not too worried that the borrow will be an issue. If I would be I could (and would probably) lock in the low borrow rate by buying puts or using some other type of derivative to create a short position. Downside is that these instruments often have low liquidity and high trading costs, so it's expensive if you want to be able to change your mind about a position.

Yahoo Finance is better than Google Finance in almost every possible way (putting almost in the sentence because there is sure something Google is better at than Yahoo, although I don't know what it is...)

I don't think there is a single correct answer. There are may ways to go short, and what the best option is depends on how hard it is to borrow shares, what the risk is of a short squeeze, what your timeframe is, what your brokers margin requirements are for various options, how much liquidity you need and what's also not unimportant is what your view is on how the thesis will play out (big difference between an overvalued large cap that you think will simply underperform the next few years versus a fraud that might get halted tomorrow).

Annual report for 2012 is available on their site since the first half of 2013. The interim 2013 report has actually already been released, although that one is not available online.

I personally find this result (and Nate's as well) just as impressive as the higher gains with the more concentrated portfolio's. With more positions there is a higher probability that skill instead of luck is the driving force behind the returns, and you have a lot less risk as well (especially with the cash position).