undervalued

That's pretty good strategy. I am thinking of doing that with the winner also. Anyone else has any suggestions? There are a lot of strategy on when and what to buy but rarely on when to sell.

What do you guys usually do about under performing stocks? Sell or wait it out? Since you can't really tell when the company will start performing (for example, LUK), is it a good idea to sell and purchase another undervalued stock?

Which shares do you guys own? FFH.TO or FRFHF? It looks like InteractiveBroker only offers FFH.TO? The price is higher for FFH.TO. Is this because it's in CAD instead of USD?

“I think it’s nuts,” he said. “If you’re running a business for the long term, the last thing you should be doing is borrowing money to buy back stock.” - Stan Druckenmiller http://finance.yahoo.com/news/stan-druckenmiller-sees-massive-problem-130107781.html

Since most micro caps companies aren't covered by news agency or analysts, how do you find the important news on what the company is doing? Do you depend mostly on the annual reports/earning calls?

http://www.nytimes.com/2015/04/14/business/dealbook/blackrocks-chief-laurence-fink-urges-other-ceos-to-stop-being-so-nice-to-investors.html I am concerned because currently market is not cheap. Usually most companies buy back when market is high and then sell shares when recession comes. By then, these activists might be gone and the long term shareholders are holding the empty bag.

I wrote some April 40-strike puts on FAST today. In a week I'll either have a starter position in FAST at a basis of $39.15 or $0.85 per share profit. Im watching fast too, do you think the multiple premium is still justified at these prices? I can't tell for sure if they're going to keep growing like in the past but I do like that insiders are buying and the shares buyback. I am prepared to buy more if it does go down a lot.

INTJ as well. Who could've guess this forum is full of introverts.

2% position in FAST. I hope it keeps going down then I'll be adding more.

But the good times inevitably end, this time most likely led by the activist stampede. The haste in which G.M. rushed to comply to Mr. Wilson’s demands, and they and other companies shed cash rather than fight, shows that the activist tide pushing the stock buyback may have gone too far. Let’s hope that it doesn’t wash out companies and shareholders. http://www.nytimes.com/2015/03/18/business/dealbook/general-motors-stock-buyback-follows-a-worrying-trend.html

Sounded good, I very much disagree. Leverage is integral to too much newly created wealth over the past 20 years for this statement to be true. Real estate, private equity, media/telecom, gaming, ... Even Buffet is leveraged in the form of insurance float. Although I agree that business positioning and operator acumen is as important a piece of the equation, but leverage shouldn't be so easily dismissed as something you don't need if you know what you are doing. It's a necessary, but insufficient condition for success. The leverage used by Berkshire has a different characteristics than those used in Real estate, PE, Media/Telecom. As WEB mentioned in the letter, no one has the ability to demand these float right away even when the company value dropped 50%. This characteristic is not true for the other kinds of leverage.

True. But so can other things. Leverage is just a risk among risks. Most should avoid it, but then again most should avoid direct stock selection and go through indexes. Thought experiment: Which of the following is riskier: 1.) A ten stock portfolio, equal sized, made up of whatever the current ten most recently discussed names on the "Investment Ideas" section. or 2.) An investment in the S&P 500 index where one buys $115 for every $100, borrowing the $15 on margin. (Margin for decent sized accounts today costs less than 1%.) This is too obvious.. Because #1, you really don't know what you're investing in where as #2 already has track records. I think for #1, we should be able to pick a ten stock portfolio, equal size and made up of any discussed names on the "Investment Ideas" section. Because more than 90% of hedge funds can't beat even beat S&P over long period of times and they can pick whatever they want.

Invert, always invert: Turn a situation or problem upside down. Look at it backward. What happens if all our plans go wrong? Where don’t we want to go, and how do you get there? Instead of looking for success, make a list of how to fail instead – through sloth, envy, resentment, self-pity, entitlement, all the mental habits of self-defeat. Avoid these qualities and you will succeed. Tell me where I’m going to die, that is, so I don’t go there. - Charlie Munger Leverage is one of those things that can kill a business/portfolio.

Does anyone have a copy of the actual letter? http://www.valuewalk.com/2015/02/baupost-group-q4-14-letter/

The biggest slice of airline revenue comes from business customers. Most of them have to fly to get to places quickly. Usually they have negotiated contract with the airlines so again the bigger player wins. It looks like they just found another source of revenue http://www.latimes.com/business/la-fi-southwest-airline-trims-rewards-20150213-story.html by slicing the same pie differently.

This is true but the big airports have limits on how many planes come in and out at anytime (Let's say every plane arrives in 5 min intervals or leaves in 5 min intervals. So there is a limit of 288 airplanes leaving or arriving within 24 hours period). Airports will have to either expand or there will not be enough capacity. Usually these bigger airports are contracted to the big four airlines for a really long time. Railroads owns them where as airlines do not and these routes are controlled by the airports (government). This is a live flight status tracker http://planefinder.net/.

Most airline analyst who are bullish in the airline industry starts to compare them with railroads. What do you guys think? There are currently 4 big players in this industry which is very different than years ago. I know Buffett says to stay away from this industry. I think he also used to dislike railroads and their unions. I think it was Munger who convinced him to take another look at railroads.

Focus on the business, the numbers will follow? "We don't believe in such laws as laws of large numbers," Cook said at the Goldman Sachs Technology and Internet Conference in San Francisco. "It's just sort of an old dogma, I think, that was cooked up by somebody. Steve did a lot of things for us over the years, but one of the things he ingrained in us: that putting limits on your thinking are never good. We're actually not focused on the numbers. We're focused on the things that produce the numbers." - Tim Cook http://www.bloomberg.com/news/articles/2015-02-11/tim-cook-doesn-t-believe-this-made-up-math-law-will-limit-apple-s-growth?cmpid=yhoo

If you think in term on how to grow a company, buyback doesn't grow a company. I think this is one reason BRK doesn't really do buyback unless the it's beneficial to the shareholders. When they use that money to purchase a new company and then grow it, it will eventually benefit the long term shareholder more.

What do you guys think? There is some truth in this. http://finance.yahoo.com/news/stock-buybacks-killing-american-economy-170000218.html

Here is a copy. Seth_Klarman__What_I’ve_learned_from_Warren_Buffett_-_FT.pdf

Sold BPY and initiated CBI.

You can also hire a property manager and let them manage it for you. I think bad tenants don't happen too often especially if you hire the right property manager. You just hear them more often because they do make a good story.

Does anyone have any information on how long before oil companies start M&A after oil prices reached bottom in the past?

Oil will take a while to recover and will never go back to $100 again.. I guess we'll see.. Pickens says it will recover right away (end of this year), while others says it will stay low for a while. What do you guys think?