ukvalueinvestment

With emerging market currencies so beaten down, and the current downward volatility, it seems to me that now is the time to buy and hold high quality EM businesses. Problem is - what are they? Are there any businesses out there with the ability to earns high returns on capital year after year, with competitive advantages like: Brands, cost advantages, high switching costs, recurring revenues etc. I'm thinking about the Coca-Colas, Moody's, Unilever's, Nestles. Companies that will be going strong in decades. I'm not interested in financials, commodity sector, anything with government involvement, anything with high dependence on technology. Can we come up with a list? Maybe these companies just don't exist outside of US and Europe?

I am not saying you are wrong, but where is the evidence on the margin debt?

Obtuse: Didn't you had a blog, though I follow you on twitter. Those are great numbers.

Congrats. I'd be interested to know your biggest winners and positions. Also, I'd love to know your portfolio today :)

Haha. Great observation!

The UK University system used to be "European", in that you didn't really pay for university, and you got grants for living costs. In the past decade it has become more "American". University fees are £9k per year and you take loans for these and living costs. I'm undecided about the costs/benefits of charging large amounts for eduation. I see both sides of the argument. I would say, though, that it feels very odd to this Brit that in the US it is apparently possible to have easier access to university if your parents went there (or am I wrong)? This surely isn't very fair?

He owns Fiat. He and Pabrai talk a lot.

If I had a wealthy father with wealthy friends to seed me, it certainly assist me in escaping the rat race, living the life I want to, and being a nice person that gives back to society.

Italy's population shrinkage may be shrinking but what's that got to do with a holiday town in Liguria, where prosperous people from around the world may be happy to buy propertly?

Just be aware that 57 years is unusually short - surprised you got a mortgage on that - and that it will get less and less liquid the shorter it gets.

Interesting. Many buyers are cautious about buying properties on a short lease. How much certainty over renewal costs do you have and how will you fund them? I guess you could now remortgage?

I was in Portfofino and Santa Margharita a few weeks ago. One of the best places on earth. I don't have much advice for you Gio, except to say that most people would dream of owning an apartment there...

To me, it's fairly clear that in what appears to be a permanently lower interest rate environment, todays's valuatios are "reasonable". Reasonable means not obviously cheap and not obviously bubbly. He said somewhere that there have been two occasions that stocks have been obviously cheap - 2008 and 1974, and he openly said so. Assuming he means the same on the topside, that means that things are in between ("reasonable") the vast majority of the time.

The only one I might take issue with is number 7. There are definitely circumstances where you should accept you were wrong, accept a loss, and move on ASAP. I get that the market might have overreacted to the downside and I get that you shouldn't act on emotion, but still...

Agree with the point about service. They are about the only company I know where an intelligent human being answers the phone reasonably quickly (rather than having to presss loads of buttons and wait ages) and you can have a sensible conversation. Seems easy, doesn't it!!

I have an Amex that I pay a £120 per year fee for. It has a great deal with British Airways miles. That's the only reason I have an Amex. Other than that, it's not as good as Visa because not everyone takes it.

Could some of the reason for the Morningstar downgrades be because the funds attracted flows, got bigger, and they had to change the sorts of stocks they were in?

I recently sold my flat in London, taking some equity out, and am now renting. I target 12% on my investments and that will beat housing over the long term - obviously you have to make adjustments for difference between rent payable and interest on a mortgage etc when doing calculations. Most people who aren't value investors just don't get that housing may not be the best investment for them. Rates have collapsed over the last 40 years, and house prices have soared. Anyone who bought 10, 20, 30, 40 years ago looks like a genius. Setting aside finances, I have found there are pros and cons to being a renter: Pros: Flexibility, can move any time. Don't have to worry about appliances breaking, don't have to worry about interior decor. Save on maintenance costs. Cons: Don't have the feeling of "home". Can't customise your place. People think you are unusual. This is the conversation I usually have: Me: I'm selling my flat Friend: Where will you buy? Me: I won't, I'll rent Friend: What will you do with your equity? Me: Invest it Friend: """Total Incomprehension, conversation ends***

Mine still displays: "Invest in UK Student Property! 9% net returns GUARANTEED for five years!" Anyone want to hazard a guess what happens at year 5?

Obviously 100 families in 10 years. There is no discounting when it comes to human misery/happiness.

If you're any good at compounding capital, doesn't it make sense to compound it over a lifetime and gift a greater amount to charity towards the end of your life? Then you can do the most good.

As I said in another post, I don't think you can really opine on "who is the better investor"? There are so many variables including: risk taken/macroeconomic environment/underlying market environment/luck/market structure, to name a few. It's the same as comparing sportsmen from two different eras. Levels of fitness have changed, tactics, nutrition... would Babe Ruth have the same record if he was around today? Probably not (I know nothing about baseball).

Interesting. I'm not sure Usain Bolt could run a marathon in under 2:30. That is an elite time, he's just not build for it. Any sports scientists out there?

This is kind of how I feel as well. Not only the message he sent to others, but like anyone who does this, it is a selfish act completely disregarding the effect it will have on those who are closest to him and care most about him. Even thought the suicide rate isn't as high in the US as it is in some other countries, there are now more suicide deaths than traffic deaths in this country, it is just sad all around. People with depression, on the verge of suicide, don't think rationally about the message they are sending to others. They have a deep mental pain, and just as you wouldn't expect someone with 2 broken legs to make good decisions, nor should you expect someone with this kind of illness.

To me it makes perfects sense that there is opportunity in Spin Offs. Any spin off will create new securities and new capital structures, and potentially financials that are "not clean". There will be new sets of incentives as well. With new management teams with new ambitions and goals. There will be forced selling, where new equities do not qualify for certain funds (due to size/index/sector restrictions). In such an environment a good analyst/investor has an opportunity to find outperformers. That said, most MBA students are told to read "How to read a stock market genius" these days. It's a great book. There are even blogs and email newsletters dedicated to them. So whereas in the 80s Greenblatt and a few others were the only people actively looking at spinoffs, now the universe is much larger. Therefore, the market is more efficient than it was. Comparing Buffett to Greenblatt is pointless, IMHO. Completely different eras, market returns, opportunities, goals etc.