rpadebet

We need to differentiate a bit here between outcome and process: Beating the market is an outcome. This game is far more enjoyable if the focus is on efficient capital allocation i.e. if you enjoy understanding businesses, their competitive dynamics, the environments they operate in, how they generate revenue, how they spend and how they invest, it is far more fun in my own opinion. This is true irrespective of the market conditions and price where it is trading at. As investors we are only serving as cogs in that wheel trying to move money to the best utilizers of capital given prevailing prices. If we keep doing it right, eventually we might beat the market, as good capital allocations must necessarily triumph over bad allocation. Hopefully we are not doing it only to beat the market, that would just make us keep staring at the scoreboard. Agree with Schwab in that the game seems to be as hard as it ever was. The tools have changed, but everyone has access to similar tools.

Pretty interesting that their filings refer to auditor in salt lake city On OTC Markets website it is Ocean city, MD with same name, same phone number but different email id to the one in salt lake city or the one covering amnf. Did he just move? Does he maintain different email ids for different clients? The PCAOB audits though indicate deficiencies with convertible debt accounting in 2015 and good will in 2011. Not much debt in AMNF (would be more concerned if there was some revenue recognition deficiency) - but I know this argument still doesn't kill the one cockroach theory. It just seems to me that they are an inexpensive auditor. Those audits also don't indicate presence of any other offices except for the ones in Salt Lake City.

The issue with them is they were spun out of FAB Universal, which ended up being a fraud. Other spin-offs from FAB have done terribly. LSYN still uses the same auditor that FAB used (Gregory & Associates, which is literally one guy in Utah). Almost all of G&A's clients have ended in bankruptcy or fraud. G&A has failed both of their PCAOB audits. The only semi-legitimate client G&A has ever had is AMNF. The cynic in me says clients use G&A for reasons other than auditor attention. I also passed on LSYN at 40-ish cents so I may be biased now. I have no opinion on LSYN otherwise. Auditor for LSYN might be a different G&A LLC than the G&A LLC auditor of AMNF. LSYN guys seem to be from Ocean City, MD AMNF guys seem to be from Salt Lake City, Utah Where do you see Ocean City, MD? I'm pretty interested if there is another G&A or if they have a satellite office. That would be news to me. I went off CIQ so they could be wrong but I just looked at the 10-k and it looks like the same G&A. I looked at the OTC Markets website for both. They could be a satellite office or maybe the OTC site has it wrong

The issue with them is they were spun out of FAB Universal, which ended up being a fraud. Other spin-offs from FAB have done terribly. LSYN still uses the same auditor that FAB used (Gregory & Associates, which is literally one guy in Utah). Almost all of G&A's clients have ended in bankruptcy or fraud. G&A has failed both of their PCAOB audits. The only semi-legitimate client G&A has ever had is AMNF. The cynic in me says clients use G&A for reasons other than auditor attention. I also passed on LSYN at 40-ish cents so I may be biased now. I have no opinion on LSYN otherwise. Auditor for LSYN might be a different G&A LLC than the G&A LLC auditor of AMNF. LSYN guys seem to be from Ocean City, MD AMNF guys seem to be from Salt Lake City, Utah

Too tough, they didn't disclose much 1. business in turnaround...much more valuable if it turns around and that will take time------plenty of names 2. Sum of the parts > market price .... again many names which fit the bill depending on what value you ascribe to which part. All they are saying is they are doing classic value investing....

Why bad? Increased employment->increased wages-> increased expenses/savings/investments -> increased revenues to corps -> higher top-line growth->higher stk prices at static P/S ratio? It would be more interesting to see how the US population will choose to spend the "tax-savings" in the aggregate at this stage of the economic cycle. Growth investors can find value in those sectors/companies if they guess right. Given the continuous/durable nature of these tax cuts compared to some of the other temporary ones we had, at this stage of the cycle, I would guess people would spend on cars and such higher order durable goods. Lucky for value investors these also sport some of the lowest PE's with good operating leverage. To the original point of the thread, there was a global rally in stocks last year. Did everyone think US tax cuts benefit companies everywhere?

If puts expire in the money, aren't you now exposing yourself to short term capital gains rate instead of the favorable long term rate at a time when your stock itself is down? Some of the companies we buy stay undervalued for years but don't we hold those hoping undervaluation would be cured? On the flip-side isn't it ok to have over-valuation persist for a while too? Why not let some good luck offset some of our bad luck. We are not all Malone genius. Investing is complex enough as it is without introducing this new tax dimension

Don't they do this every year? I think it is a pretty good concert to get all the disparate small vendors, suppliers, associates into a room once a year and keep them motivated to continue to do business. Something similar happens in Omaha each year too I hear.

Yes VIG is a good ETF. I considered it. I liked the mutual fund VDIGX more though because it had 50 or so stocks in there. VIG has too many stocks to perform that different from a market cap index. Looking for an ETF which is more like the Magic Formula based ETF with low expense ratio, handful of stocks and fundamental based weighting. The idea being selection of companies and weighting in the index should be "price blind" as much as possible with the market price coming into the picture at the last possible step. An ETF which implements the Buffett-Graham-Dodd rules. Would also be interested in something which implements the Walter Schloss investing style

Thanks menlo. I do like the QVAL approach somewhat. The approaches he mentions in his book seem to have a lot of outperformance. I need to dig deeper into this, but do you know whether this ETF tries to implement some of those ideas? Most of the other alternatively weighted funds mentioned, seem to have too many securities in them for weighting to have an impact. The Davis funds seem to be a good candidate to explore but need to see whether it is a rule based selection or if there is a human touch And regarding LEXCX, I think there is a certain amount of comfort in predictability of portfolio. Knowing what my fund holds and knowing that it won't change too much if I ignore it for a while is worth something. By the way, would be interesting to know how many of you use ETF's in your portfolio and if so to what extent.

Guys, I was trying to research and find some true value oriented ETF's out there which could potentially help me automate a portion of a my investing at a lower cost, for unrelated personal reasons. Do any of you have any experience with it or truly like anything that out there? If so what are they? I am basically looking for ETF's which base their selection on fundamental non-price based qualitative factors and weigh the selections based on some proxy for potential payoff (difference between price and estimated intrinsic value). I am not too comfortable with market cap based approaches given their propensity for overweighting whatever is popular in a given period. I am looking at a fund like LEXCX where the constituents were selected in the 1920's and not tinkered around with after except for mergers/acquisitions and spinoffs. That has beaten the SP500 comfortably over a long period of time. The idea was to find something like that today for the next 100 years. Want it in an ETF format because, I don't want to deal with forced dividends/taxes etc unless I really need to. Any thoughts and help would be appreciated.

Desert_rat: The idea was to learn from investing mistakes of each other, Not looking for a confirmation of a particular stock selection, definitely not looking for hugs. Mistakes are not necessarily where you lost the most money on a stock, you could make money being lucky and it still can be a mistake (that's my example). So if you have made a mistake and have learnt something valuable from it, please share so it would be good for others to learn from your experience. It is probably tough to think about mistakes in a roaring bull market when the tide is so high, but this is probably the better time to do so.

After a brief self imposed hiatus (due to various reasons) I thought I would re-join with a confession. My worst investment mistake netted me a gain of 40% in less than 6 months. Before you guys think this is some display of false humility or disguised gloating, allow me a chance to explain: In late summer of 2012, when I was a clueless "investor" (still suffering from it, but it was worse then), I bought a bunch of Facebook stock. Those days I hadn't read any of the value investing principles. Thought Buffet was just another Democrat who made a bunch of money in the market/business. Had suffered through losses in 2008 and hadn't learnt my lessons (not for lack of trying, but was reading the wrong stuff). Luckily for me, through my tryst with "observing" the market stress, I had developed a "feel" then for when things were stressed out enough. So after the FB IPO when investors were dumping the stock for fear of user growth saturation and no mobile strategy, I made a ballsy bet by buying FB @$19. Then in the fall of 2012- early 2013, in my search for better investing principles, I found religion (this religion of Value Investing). I read a bunch of stuff, all over the place, but hadn't discovered the BRK letters yet. I read about deep value investing on how one buys assets and not earnings. How one is supposed to invest in at a discount to book value. This stuff made sense to the naive me at that point.(After all how could one go wrong buying 1$ for 50 cents? duh!) I started investing in value based mutual funds, to observe the professionals in action. I kept reading but didn't read the BRK letters yet. Something strange happened and I started worrying about my FB stock. I hadn't applied Value Investing principles and selected it more out of a "gut feel", what if I was wrong? So by April when I was almost sure FB didn't fit into Value Investing philosophy I immediately sold all the stock @$27. I told myself, wow, I got lucky with a 40% return in under 6 months, especially when I had no clue what I was doing. I later made a lot of Value investing bets like AIG, MBI, MSFT etc where I made decent returns and i knew (at least i thought I knew) why I was making money. I met a bunch of big losers too like BBRY, CTCM, ARTW (this list is long). I did VRX too (made a bunch on way up and lost most of the gains on the way down, from about the same buy price point interestingly :)). All these losses though taught me something valuable about the risks I hadn't considered.(when you lose money, you gain experience as WEB recently said in his letter! that is indeed true for me). What the early value investor in me had missed was taking into account melting ice cubes and giving secular growth enough credit. It is dangerous to your health to have half-assed knowledge and interpret the religious teachings narrowly, especially when you don't have the discipline of the great gurus. Percentage wise I think I lost more on VRX on the way down. But I still consider FB my worst mistake. It is one of those things, not error of commission or omission, somewhere in between. Was lucky enough to buy it, didn't have the intellect to do nothing and hold it. As you guys know that particular stock is up 5x from my sell point and more than 6x from my buy point. I haven't had 5 baggers, but this could have been it.... in just 4 years! Alas... (also read as "a loss" which I haven't suffered in any other stock....yet) Just wanted to share this after reading WEB's take on, a person with experience meeting a person with money, in his latest letter. Sometimes something looking good on paper might indeed be your biggest mistake as it could have been great! Never assume you understand any religion because you have read it once. Reading once again might give you a different insight, if you still have a teachable mind. Would be interesting to hear the worst investing mistakes from others on the board and their learnings from it. (only one mistake could be your WORST!) PS: Recently after lot of gut wrenching, stomach churning and fighting my inner demons, I decided to atone for my past sin and made a purchase decision again on FB @$120. Yes this was a very tough decision. The market didn't give me the value it once gave, but there was a small sell off given growth uncertainty and I could convince the still alive market timer in me to go for it. The market might as well be right this time, but I am hoping to beat it by holding it for long and wearing it down! Might not be a 5 bagger anytime soon, just hoping for decent returns this time. Let see...

How about paying these rating agencies differently? Why not pay them using the bonds they rate? And force them to hold those bonds until maturity or at least a fixed period of time. That should align their incentives with the buyers right? They certainly would have been more careful with aaa ratings on some CDOs

+1 But it is enjoyable to try and expand the circle no?