frommi

+1. But margins are already contracting, so its unreasonable to assume they will widen further from here. Foreign countries are a little cheaper, but its unsure if you will be able to get the returns of the foreign markets without hedging the currency and you have have other risks there, too.

I am not so sure anymore if BEN and BBBY are valuetraps. And because i hate to be unsure i sold the positions.

Isn't the real risk for buying real estate with large amounts of debt that the bond market has it right and we get a long period of deflation and a recession?

russel 2000 futures, ev/ebitda for the index is above 19 with high leverage and shrinking earnings, this can't end well. But may take a while to play out.

And covered the rest of my shorts.

IBKR, MIICF

Sold RGLD, TGT. Bought LILA and covered most shorts, now 50% net long.

IBKR is growing, but is it because it reinvests its capital or would it grow without it? For me this is a business that doesn`t need to reinvest its money, because the business scales so well (at least in theory). The problem is they reinvest it into higher wages and more developers. Is this necessary (and what is the return on investment here) or could the money be used for higher returns on other uses? The problem with ROIC is that it masks the real "return on investment", it is just an accounting number. You don`t know why earnings were growing, it could be inflation, price increases, a consumer fad, higher/lower commodity prices, organic volume growth etc. It doesn`t necessarily come from reinvestment of earnings.

Yes, but a qualitative assessment is subjective. For example i wouldn`t put CMG into that basket. My problem is that everybody talks about this subject and thinks that for example BRK belongs into that pocket. But its nothing special to compound capital at 10% like BRK or MKL did during the last decade, in fact i have plenty of companies on my list that did that and 10% is the long run average ROIC for american companies. Most of the time it will be better to just get the money out as dividends or sharebuybacks where i can invest it at higher rates. And for the companies where growth was higher in the past there is always a question mark if they can sustain that level of growth. If the answer is yes fine, but often when the answer is no and you find it out too late the investment results can be a disaster. In the end when you want to invest in companies with growth of >20% most of the time you are a momentum investor. Theres nothing wrong with that, but you should be aware of that fact.

+1. I don`t know if it was Buffet who said that, but the best investment is one that grows without reinvestment of capital like See`s Candy and throws of a lot of free cash on its way. This whole compounder stuff is way overrated since ROIC is mean reverting. Number one determinant of future rate of return is price paid, every backtest that i have seen confirms that. ROIC doesn`t even have an impact on returns, this was highlighted in "Deep Value".

They don't support companies that are trading OTC. I have several alerts there for OTC companies and they work.

conferencecalltranscripts.org

Sold VTR,MPW,OKE,UL,NSRGY,FAST and bought LICT (new position), CHRW, AFL, BEN.

What i took from the book was that 25 holdings with a value framework lead to the best sharpe ratio, the rest is just for entertainment and for me only 2 of the stories were new.

more CHRW,AFL,NXRT,BBBY,CSCO,AMNF. But still net short 80%.

You are probably underestimating the impact of fees (especially of a fund of hedgefunds) over a long enough timeframe and most hedgefunds don`t necessarily hedge. Look at Druckenmillers or Richard Dennis track record to see what you can do when you are able to play the market on both sides without restrictions. But its hard to pick 5 hedgefunds and outperform because the more funds you pick the more you are the market itself. Since you can`t outperform the market when you own the whole market the only thing that matters is fees. Thats the reason it was an easy bet for Buffet.

bought some more AFL,PDER and NXRT

http://www.factset.com/websitefiles/PDFs/earningsinsight/earningsinsight_4.22.16 Summer season starts tommorrow, so i am officially allowed to hedge now. I am now short S&P500 and DAX futures and long under/fair valued dividend growth stocks. Net short -100%, maybe a bit bold but i expect a pretty steep downmove this summer.

Is there something new in it, assuming i have read ~30-40 books on value investing?

Here is my valuation watchlist of dividend stocks, i am sure there are plenty of errors in it but it has worked for me. Perhaps there are some ideas for you. https://docs.google.com/spreadsheets/d/1HjdCBGkRsS83oAYMs0MmV_oPkm0nv7PtPnAZLy6DdTk/edit?usp=sharing The important column is FRoR 5Y which is basically the expected annual CAGR for the stock assuming it trades back to the average/fair multiple and growths by the assumed growth rate.

Historically moving to a permanent portfolio asset allocation (25%cash,25%gold,25%LTT,25%stocks) in these times would have been a very good idea. Personally i hedge with futures (I favor Russell2k, DAX and FTSE futures at the moment for that) over the summer, because that has worked for me very well and the carry cost is minimal. But i have at least a small edge in market timing. (>60% batting average)

1.) When you buy or sell cyclical stocks based on valuation you will get what you deserve. 2.) There is no bubble in dividend paying stocks. There are cheap dividend paying stocks and expensive ones. Utilities are expensive here, but far from a bubble. (~15-20% overvalued, but given where interest rates are thats fine.) In fact when you think interest rates go up (and inflation, too), why are you shorting businesses that profit from that?

And you assume that someone that indexes is able to hold even if the index sucks and everybody else is outperforming like 2000-2002. Indexing sounds easy on paper, but in real life with emotions and all the macro news involved its not that easy anymore. For me successful investing is all about finding YOUR way to invest, a way that you fully embrace and can stick to through thick and thin.

The correlation between earnings and prices is very weak, this is wasted time. :) https://caldaro.wordpress.com/2016/03/08/stock-market-myths-and-whats-wrong-with-the-economy/

Thanks, interesting conclusion. But it looks like it doesn`t work that way for healthcare REITs? I didn`t look at the numbers in depth, but is there a reason that expense ratios are high in that sector?