randomep

So, let's invert: if you don't phone oddballstocks and/or management, you have 40% handicap on a small cap. Suddenly mega caps look much more level playing field. 8) But because you can, then you are saying that it isn't a level playing field, because it favour YOU if you call mangement? Then what's the problem? It is the holy grail of getting an edge right?

Folks! I see 3 posts since my post but I am not sure if they are directed at me. I'll assumption such. Firstly, I never said large caps are more efficient than small caps. I never really even thought about it in those terms. Secondly, yes an average (or more accurately a typical) person, will have the same life expetency, the same chance of having a genius IQ and the same returns as the average person. It is a tautology. What I am saying is that I have a chess rating of 1960, and I play in the under-2000 category. People who are experts and masters play in the above-2000 category. I think I can win in my group. The point is that Warren Buffett , Ackman and the like are all in the above 2000 group and are playing each other. I said this in a post earlier, I believe if you are rational and your single goal is to maximize your wealth, then you have to believe you are above average if you apply the knowledge from this forum. Otherwise the rational thing to do is to join the Boglehead forum and apply the advice there. The other explanation is that you want to have fun and feel productive.......

Jurgus, what you and others are saying is definitely true. Someone can always mention some obscure way of making money. And you cannot dispute that person. Dan Negranue can say that it is easy making money at poker. But I am not going to do it. Someone who looks like Brooke Shields knows she can make money modeling. And some guy in Japan can say he made $30M day trading futures. But I am not going to follow him. The fundemental goal (other than to have fun and feel productive) is to make as much money as possible with as little risk as possible. If someone thinks he can make money with large caps then I cannot argue with him because I don't know him. But what is he saying? He is saying that he can play the same game as the money managers and beat them. Only about 20% of money manages can beat the market. He is saying he is in that club. All I can say is good luck. Maybe he has a 150 IQ but for a guy with average IQ like me I'd rather stick with something that is more likely to work. (Also btw I also wonder why isn't he managing $1B if he is that good?) And small caps are more likely to work because there are less smart money managers in the same game, and the choices are much greater. I feel I am a small cap investor but that does not preclude me from buying large caps when I see value. So what I play with is a superset of what a large cap investor who ignores small caps play with. Then it is logical that my odds of success at beating the market is great than someone with the same ability who only invests in large caps. Again it isn't about looking in the rear view mirror at what has worked. For example someone buying Brk for 20yrs (and I am a 15yr holder of brk btw) and saying that will continue for another 20yrs. I am selling Brk now because I don't see how it can beat the market by a significant amount. I've said this before and I got tarred and feathered for it, but I stand by it. Someone said let's revisit in a year from now and see how Brk does.... well, last 12 months it is flat.

I am surprised no one mentioned value investing.

+1 That just about sums up the answer to this thread.

Doyle Brunson Super System :D

We have had a Facebook "Like" button for a few months now. ;D oh ya.... how does that work?

is this place turning into facebook?

Just an antidote, my company spent 2 years and a couple of different agencies searching for someone to fill a certain position, they eventually found me through my linkedIn profile, contacted me, and made me an offer I couldn't refuse (and my former employer couldn't match). So I owe my current job to linkedIn. Same here. I post my resume on monster.com whenever I start looking. And it alerts recruiters immediately. I have used it to land jobs 1/2 a dozen times. So, that's my medium, so can I argue that monster should have the same valuation as linkedin?

I have never shorted anything...... but I was comtemplating AMZN 6-8months ago...... well glad I vacilated !

Stress Test, written and read by Timothy Gneitner Its that much more revealing when the man reads the whole thing. And he did a good job .... both writing and reading it.

What he is saying is that collectively those who invest in these companies will lose their shirts. No one is arguing that these companies are useful and have a profound impact on society. But unless the investors like giving their money away to charity, these companies are failing the shareholders. Back in the dot-com days, e commerce companies were selling $100 worth of goods for $75. Ok so ya the customers loved them, but they screwed the shareholders.

So, we can have a rational traditional evaluation/comparison of high flying companies???? really? Company A: no meaningful earnings for 20yrs , P/S 2.5x Company B: P/E 15x, P/S 0.5 (A: AMZN, B: WMT) I saw some articles that compared the following two companies: Company A: eps -$3, fwd PE 85 , P/S 30x, and even these sales require government subsidies Company B: was one of the most profitable companies for 50 years before it went public (A: TSLA, B: F) Now I'd probably be laughed off this board for saying that. But I have seen 1999 . I was in Cisco through a buyout. And I had some idea of PE, interest rates, cost of capital..... But I couldn't see how with the stock options being given out, the the companies could be worth such. But the argument was always, we are in the cusp of a new era where traditional financial thinking don't apply. Now I see a similar head scratcher. A new generation of men and women who didn't finish college but have 170 IQ are selling companies at billion dollar valuations without a formal plan to earn money in decades. I don't know what products we use 15yrs from now. I bet none of us guessed the proliferation of smartphones 15yrs ago. If you think all I've said is crap, then ya.... maybe twitter is worth whatever its worth.

Like Mike Burry did, yes? :P Every now and then life is subject to random error. :P To be fair, while Burry is brilliant, his early investors didn't know at the time that they were signing up for a big macro bet when they invested with him, they thought they were getting something else, so without the hindsight of knowing that the bet worked out in the end, it's pretty easy to understand that they were nervous and some wanted to get their money out. If I had put my money with him for his value-based stock picking abilities and learned that he was buying vast quantities of credit default swaps and side-pocketing the money, I might have gotten nervous too. I don't know. Liberty, the issue was not that they were nervous while the bet was working out. The issue is that they dumped him after he made multimillions for them. "So long and thanks for all the fish" and all that. Jurgis, you are correct. But I think I would've tried to pull my money out if I was invested with him during the crisis. After the bet played out I think the investors (who were sophisticated) felt that he did not do what they signed him up to do. So they pull out. I cannot blame them. It is only with 6yrs of hindsight and 2 popular books written about him that we realize the brilliance of what he did. As the crisis unfolded I think the only way I would've believed his thesis is if he showed me the bond prospectus where there was an X % of people defaulting on the mortgages in the FIRST month!

The electorate is trying to do the same thing over and over and expecting different results. They keep going for a fresh face that is not incompetent and not a liar. But the electorate is begging for a liar. I don't know what trump stands for (it is very vague) but much of what he says is going to be revealed to be a lie..... - if he is president he really is going to make Mexico pay for a $100 billion wall? How exactly is he going to make mexico pay? And even if he can make mexico pay, mexico doesn't have the money; so that's a lie that he can make mexico pay - he had a deferrment in the vietnam draft because of a bone spur in his foot, BUT he doesn't remember which foot, liar! - he said he did not say macain is not a war hero? excuse me? I heard it with my own ears! And his appeal believe it or not is that he tells things like it is! As the campaign goes on he will constantly backtrack and contradict himself........ it will be a funny thing to watch

Eric, As often with financial laws, there will be unintended consequences. So you are saying if a person rolls their money over to another investment within a certain time period it would not incur any tax. But investors could easily game this .... they would just put the money in an ultra ultra short bond as a proxy for cash. Or would you say that buying a bond fund doesn't quality as a rollover investment? Or is it just short term bond funds that don't qualify as investments.

Anyone? Also, what about locking in gains with options? Of course less doable with foreign and small cap stocks;.. I presume you are talking about put options, but they just delay the invetiable. If your stock drops the option is in the money and will give you a capital gain when it expires. Usually when you want to sell stock it is because the stock is overpriced, holding on becomes more and more risky.

.... also interseting... he is a mormon

He didn't say he doesn't know who Dan Loeb is, he says he doesn't give f*ck about him.... I have seen a lot of good quality 1yr old posts that peter out, I just hope he keeps it up

+1 thanks!

Wow. Who is he cloning on the FCAU and ZINC positions? He has mentioned that ZINC is his first original idea, and FCAU was from a Columbia student's presentation. So you are saying he is cloning Columbia students? So I also heard on this thread he goes into positions where he expects 2x 3x gains; so how does Brk BAC fit? he seriously expected Brk to triple? Pabrai is so full of contradictions I wonder how anyone can follow what he says..... I don't know his results last year or this year... but it can't be good, GM has gone nowhere and Horeshead....well that's a disaster.....

Would you care to elaborate? I've been looking at Dickson Concepts as a possible net/net but I'm not fully convinced yet. You know my blog :) New Century Group HK (234) <---- this stock is absurd! Soundwill Group HK (878) <----- new investment

stuff in HK

I am getting addicted to bloomberg app. It has all the indicies commodities currencies and my watchlist and really relevant business news.

Defaulting is always their prerogative. If it was that simple they would have done it 5yrs ago. The problem is they need more new euros to function.....