undervalued

I don't think Interactive broker pays any interest on cash you have sitting in your account. Do you buy a money market fund while holding cash? What do you do?

is there an China index fund similar to SPY? I think this is a safer bet than buying stocks outright.

1. Since people are getting paid to borrow, they will borrow more money. 2. People have money but they don't want to earn negative interest so they spend it by buying goods/services/assets. 3. Asset prices will increase since there will be more demand from people buying them and will lead to inflation.

This NewYorker piece provides interesting perspective on the guy. I understand his thought process around frugality and it resonates with me. I was like that when I was younger. But to me the point of money is to trade it in for life enjoyment. To me frugality is a means to an end.... the article says he makes $400K a year from his blog now and yet he doesn't seem willing to make any changes or compromises in any way. That personality seems a bit on the obsessive side. If his wife is completely aligned with those beliefs and practices, then great! Otherwise seems like it wouldn't be much fun to share a house with him. Maybe it is partly for show now to maintain the personality cult that has developed around him from the blog. +1. He just strikes me as annoying at this point. His wife said: “Your relentless optimizations are a drain on my life energy.”

I have been thinking about this for a while and I think it is probably better for 99% of the population to use the index, including me. For the past 10 years, I have been unable to beat the S&P index. I did not create 'Alpha' per Howard Mark's Most important thing book. Reasoning behind switching: 1. S&P is efficient way to allocate resources, as a better company emerges, it automatically gets added to the S&P (in essence S&P is the biggest, strongest, best companies in their fields). 2. Individual companies rarely survives, go back 100 years and see how many actually survive today. This proves 'buy and hold does not work' in the long term. 3. Like someone said earlier 90%+ funds failed to beat S&P Anyone in the same boat? What is the best way to switch to S&P from individual stocks? To sell slowly and purchase S&P slowly and over time?

Soros: http://www.bloomberg.com/news/articles/2016-01-21/george-soros-says-he-expects-hard-landing-for-chinese-economy

Could you share in the DNOW thread on what you think will happen on the 8-K they just released back on Dec 24?

Did anyone has ever compile a complete list of the mental models that Charlie uses?

Damn Right is more about Charlie's life, background and family (biography).. where as Charlie's Almanac is more of his speeches and how he thinks about things.

Why is BRK an exception? Now and then, I keep finding nugets in Charlie's Almanack and one of them was a quote from Buffett talking about how everyone else is taking his words as facts where Charlie wouldn't. I think it's hard to concentrate into one idea because no one knows all the risks including BRK. Who knows maybe one day, after Buffett left, they did an Exxon or something.

Hahaha

Did anyone have suggested this subject before on the board? I am a beginner investor and I am willing to put up the time to be a good investor but I don't know where to start. I've been reading valuation books but I still don't know how to apply it. I am looking for someone I can help and also help myself learn from. It would be good if you already have a track record so I know that you're not just lucky. I have a day time job so I have about 4 hours every night to work on my investing.

Thank you Travis. That's very helpful as a beginner investor. What do you do when reading 10K? Do you take notes? Do you create excel spreadsheet from data in 10K? What kind of questions do you ask yourself while reading?

So I have been reading Valuation by McKinsey since I received the new edition. Just finished reading the chapter about forecasting. The question is.. Is it normal that I still feel that I don't know where to start? I am trying to apply what I've learn and I think I need to: 1. Find 1 company to value 2. Bring 10k history data for at least 5 years worth of data 3. Forecast what the company will earn for next 5 years 4. Find and identify value drivers ROIC, FCF, and value the company 5. Repeat #1 thru 4 for their competitors 6. Probably wait and buy the company shares when it's cheap? Even after compiling all these data, what do I need to do to understand what the data means? Do you guys usually read 500 pages 10Ks http://www.cornerofberkshireandfairfax.ca/forum/general-discussion/500-pages-a-day-of-10k's-10q's-what's-your-technique/msg235730/?topicseen#msg235730 first then when you find an interesting company do a valuation or do you guys do valuation for an industry and learn about trends?

Is this statement still true today? What do you guys think? by Walter Schloss

How much cash do people have at this point? Anyone selling to increase cash or is it not wise to do it after today's plunge? After today plunge, it brings up my cash level to around 10%.

In the article it says: Really? That's weird. I guess they operate like a mutual fund?

No luck. Only thing I am able to pull is for them is in the 60s. can you post an pdf of the document? Please? Could you pm me the database name too please?

Thanks Vinod and Jurgis.

Is there an equation anywhere for that Vinod? Why do we divide the expected cash flow with cost of equity?

So I've been reading the 5th edition of Valuation by McKinsey and I have a question. In Ch 2 Fundamental Principles of Value Creation - Cash flow risk pg 36. This is probably a basic question to most of you. Trying to understand everything slows me down a lot in trying to figure how these stuff works. How did he get $6000? Is 10 percent cost of capital the same as the DCF discount rate in this case?

Does anyone actually use the separate DCF tool that you have to purchase separately for the McKinsey book? This one is for the 5th ed Valuation DCF Model, CD-ROM http://www.amazon.com/Valuation-DCF-Model-CD-ROM-Companies/dp/0470424575/ref=sr_1_1?s=books&ie=UTF8&qid=1437196956&sr=1-1&keywords=Valuation+DCF+Model%2C+CD-ROM%3A+Designed+to+Help+You+Measure+and+Manage+the+Value+of+Companies%2C+5th+Edition&pebp=1437196947157&perid=13G3CF4757HSXX0C993S

What do you guys think of Aswath Damodaran valuation books? This one is pretty concise and short http://www.amazon.com/Little-Book-Valuation-Company-Profit/dp/1118004779/ref=asap_bc?ie=UTF8. Does McKinsey's book use examples straight from 10K without adjustments? I've been reading Damodaran's book and still has trouble finding where he get the depreciation numbers from (in the Free cash flow to Equity section). Since I can't find it in 3M 2007 10K report, I am not sure whether that number is a typo or he did some other adjustments to get to that depreciation number.

I have averaged down LUK since 2008. My average price is about $22. There has been a few times in the past where it has reach $35 and it has come back down again since then. I am fine with holding it a long time. I guess I should hold on to it and get ready to reduce when it reach mid $35 (around 1.2 BV) probably.

I've only read the Outsiders and haven't really read the full book on Teledyne. I think everyone who post has a right answer. I think there are many variables that make Buffet a better investor than Singleton. His focus, float, moat, knowledge of multiple industries, stocks / bonds, personality, etc and probably he is going to live longer. He is lucky enough to find many giants (Ben Graham and Munger) early in his life also which opens up multiple doors for him. The lesson here is probably you're not a genius, find some smart friends :P.