Aurelius

Another interesting article: http://montrealgazette.com/business/francois-rochon-the-experience-of-investing-in-carmax?__lsa=3de4-f83a

Guy Spier recommends him: http://aquamarinefund.com/who-would-i-invest-with/

Thanks! I always feel I am learning when listening to them. Hope they continue sharing their wisdom. It was really interesting hearing Pabrai talking about how he used an industrial psychologist to learn more about himself and help him get better aligned to how he was living his life. Wondering if any of you guys have done anything similar?

I'm situated in Europe. Like I said I pay taxes on the difference between sell price & the average purchase price. But thanks.

There seems to be some confusion with regards to the FFH P/B multiple. I'm going to try to have a go at it. All numbers in USD. As per Q4 the the Common shareholders’ equity at December 31, 2014 was $8,361M or $394.83 per basic share (excluding the unrecorded $452.8M excess of fair value over the carrying value of investments in associates). Shares outstanding were 21.18 million. Since then the BVPS has been reduced by $10 due to dividend. (Plus business gain/loss from 1. jan until to now) Prior to the equity deal the P/B including unrecorded associates gain was: 550 / (((8,361 + 452.8 )/21.18) - 10) = 1,35 After the equity deal: 527 / (((8,361 + 452.8 + 650)/(21.18 + 1)) – 10) = 1,26 These numbers don't take into account Fairfax' unrealized gain on Thomas Cook India and Ridley which had unrealized gain of 152M in dec 2013 and seem to have risen over 50% in 2014. Also it does not take into account the investment in Eurobank Properties which had an unrealized gain of 109M in dec 2013. Not sure how this investment faired in 2014. Is this approximately right? If not, how would you think about it?

Don't think this is feasible. The tax rules are clear: you pay taxes of your profits that are calculated as = sell price less average purchased price. RB I appreciate your willingness to help. I realize taxes are very specific from country to country. My question was a bit more simple -> how do tax authorities treat purchases of companies that have two or more ticker symbols that basically move in synch e.g. GOOG/GOOGL, BYDDF/1211.HK...

Isn't the stock more expensive on a PB than yesterday? The MKT cap has been reduced something like 624M (assuming -4.06%) while the deal financing is 650M

The very day I decided to buy FFH it went up 8% and I ended up not purchasing. What would the approximate BVPS be today after this equity financing - anyone? Trying to understand what PB multiple it is selling at.

I guess there are different tax rules in different places. I was taxed as per my average cost.

Yes sorry I wasn't very clear. I meant how are we as investors taxed. Reason I ask is I once average up before a quarterly report after being up closed to 100% on the stock. It did not go as I had hoped. Later they stock dropped a bit and I wanted out partially. Instead of taking a loss and being able to tax harvest I now had to pay taxes. If the stock instead had two ticker symbols I would then naturally invest in the unused ticker symbol when averaging up.

I was wondering how stocks which have more than one ticker are taxed. I'm thinking of stocks like: GOOG - GOOGL BYDDF - BYDDY - 1211 Are they considered as one entity or different investments?

Personally, this is a subject I've been thinking a lot of lately... But initially I would go for proven business models that have outperfomed the marked over long time. Candidates would be: BRK, MKL, FFH, --> I would pick businesses that have people and culture I respect, trust and have track records. Wells Fargo has outperformed over long periods. Endorsed by Buffett. I would feel very comfortable allocation a portion into WFC. A basket of companies with high ROIC, moat, growth runway and great management (yadayada's point) Companies like google, byd, amazon, visa.....

Hi Gio, care to expand on why you are choosing GLRE over MKL (I was browsing the MKL thread yesterday and you were opining positively on MKL), considering MKL should have a lot of runway considering its size plus it has a long history of good underwriting, investments and stock performance results. In contrast - yes Einhorn has excellent investment performance - but what do we know about its insurance operation? Would love to hear your version.

Congratulations Sanjeev! Tap dancing to work - awesome! I've sent an email as well. But I live overseas - what about us Europeans?

To expand on the loan specifics. First year payments run for up to 5 years on 4%. 2nd year for 4 years on 4% etc. After graduation she'll have 15* years to pay back @ national bank discount rate + 1% (present cost is 1%). It can not be delayed further. She will have to pay fixed amounts each month or pay back sooner if she wants to (which would defeat the whole purpose this plan…) *I was wrong. Payback period within 15 years after graduation, not 11 years. On tax incentives: Non other than she will be able to deduct interest payments for years 1-5 when she starts to pay back. Beerbaron: If possible she will transfer money to me each month automatically. I will then invest it for her. deepvalue: Her start salary is at the minimum presently $6650 a month in her future profession. merkhet The ideal scenario would be to compound at 4% (or more obviously) while studying. That way she will have a fixed 15 year loan which would be very cheap. Compounding at lower rates than 4% could still make the overall loan very attractive. --- I am a little surprised about the worries lots of you have. I am thankful for your concerns. This means I need to talk more with my sister. This just seems like a deal too good to pass on. At least if you did it for yourself. Two scenarios: 1) She has graduated and has compounded at 3-4%. This will save her quite a bit of money when she will need to borrow money for a place to live. (Probably 2% is also fine… haven't done the math) 2) Assuming she is down 25%, which is going to be hard averaging in**. In this case she could leave the money for investments for a further 15 years at a very low cost while paying back the loan. **To be conservative she wouldn't have to invest the year 5 loans in equities. Instead just put it into her bank account.

My sister recently started studying at university. After taken my advice, she has taken on a student loan. This student loan will give her appr. $550 a month. Her studies will take 5 years. The loan will cost her 4% per year while she studies. Post university the loan will cost = the national discount rate (0% presently) + 1%. She will have to pay it back within 11 years after graduation. The plan is to invest the loan while studying and thus have a very cheap loan after she is done with her studies. If she would get 4% annually while studying it would be a success. Safe returns are more important than going for maximum returns. I have some ideas where to invest her money, but I would really like to hear your suggestions...?

I'd recommend Victor Frankl's "Searching for meaning". It's short, but very good, containing some very useful life lessons. I'd also recommend 7 habits of effective people. It would be an advantage to read it (and use these principles) early in life.

Using torrents, is there something special I should be looking at, to ensure it's safe?

Makes sense! Here Alice Scroeder saying all he ever wanted was a 15% return on day 1(Starts at 18.08):

Some blogs I like. Description is from the blog owners themselves. http://fundooprofessor.wordpress.com/ - Thoughts of a teacher and a practitioner of value investing and behavioral economics http://csinvesting.org/ - Intensive investing education through case studies http://greenbackd.com/ - Deep value, contrarian, Grahamite investment http://brooklyninvestor.blogspot.dk/ - Random Thoughts on Investing and Investment Ideas http://basehitinvesting.com/ - Using commonsense principles & proven strategies to methodically build superior investment results I use them for learning how to think about investing.

Interesting paper, but it would have been even more interesting if they focused more on the extreme spectrums, i.e. what happens when we get high CAPE overvaluation. They did state: Not sure if this means that market timers profited going completely out of equities when CAPE was over 16.4. I'm quite surprised by this but I'm not sure if the sample is significant. It's a little disappointing that they spent so much time talking about regular PEs vs CAPE. I wonder how market timers would do if they only went out of equities when CAPE was highly overvalued? For example: CAPE 20; 20% cash CAPE 25; 40% cash CAPE 30; 60% cash Etc.

I've been reading this thread with great interest. It's a subject I've been having real trouble with. I've been going back and forth with regards to how to position my portfolio. Since CAPE and Tobin Q have been the most reliable indicators on overvaluation and subsequent future returns I was wondering if you had tried to model if it makes sense to hold higher cash level when CAPE/Tobin Q are high assuming you got market returns. It could be modeled something like this (using CAPE): Less than 20; cash 0 20; cash 5% 21; cash 7% 22; cash 9% 23; cash 11% 24; cash 13% 25; cash 15 % Etc. Or something of the sort. I hope you post your essay as it seems like an interesting read.

Is there any economic rationale for not accepting less than 1M (or having limits in general)?

Thanks netnet! I can't seem to find the creativity class. Could you post a link?

I lost the passion for it and wanted to take my life in a different direction. Continuous increased competition would mean lower win rates and thus more and longer break even/losing stretches. If you don't truly enjoy it I don't think your results would be any good. To justify playing poker you need to make quite a bit more than at a regular job.