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sdev

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    Fairfax Africa

    in Fairfax Financial

    Posted

    Anyone have any color on what the fundraising outlook looks like for Helios?

     

    They mentioned on the AGM that EM fundraising is tough - and I presume Africa is one step tougher (as Brazil, India, etc - seem to be raising loads of money). They also indicated that they are looking at raising a RE fund and have "interesting" things going on with respect to capital markets activities.

     

    I think if they do actually have the clout to raise an equal or larger PE fund + start a successful RE fund, and continue following through with good returns, this could be a great price for the business. But if it's just a balance sheet (vs an alt asset manager) it's much less interesting.

    Results out

    in Fairfax Financial

    Posted

    While I won't argue that the business will not grow / contract in the future, because it likely will - what is concerning is the equity investment strategy over the past 10 years has been a disaster, select large portfolio holdings are homerun swings without a clear strategy, and the forward equity strategy is a mixed bag of investments without any clear investor advantage other than, it's cheap.

     

    The age old strategy is to be the best at your part of the world. I personally am guilty (perhaps very guilty) of thinking that my investable universe is larger than it should be. In my opinion Fairfax could do with an overhaul (read: narrowing) of how they deploy equity capital - as it's possible to buy "cheap" assets in any market, in any vertical - with patience and best in class platform / skills for the niche.

     

    As my underwriting box thankfully narrows over time - Fairfax falls outside my criteria, and I'll be peeling off my 10+ year holdings over time, with remorse.

    "Major" Microsoft Announcement Monday

    in General Discussion

    Posted

    haha, probably them topticking the social media scene by buying Yammer.

     

    you are correct sir

     

    I can just imagine a fictitious war room at Yammer:

    #1 "Crap! The IPO window is shut!"

    #2 "Are there any private bids out there?"

    #1 "All we can find is Microsoft"

    #2 "What's their bid?"

    #1 "$1B"

    #2 "WHAT?? SOLD!!"

     

    That being said I'm just poking fun and I'm sure those involved on both sides are far smarter than I.

    Anyone want to help a New Grad out ?

    in General Discussion

    Posted

    I disagree with Sharper's argument against working for banks.

     

    Look, if you want to end up at a buy side fund, the most straightforward route is to go the investment banking route. Look at almost any value fund that employs handfuls of analysts, they all tend to have a couple years of i-banking experience.

     

    That's not to say its an absolute requirement, it isn't, but you'll just end up having a harder time breaking in.

     

    I agree. Saying "don't work for the banks" in an absolute manner is ridiculous.

    Convertible and Preferred Stocks

    in General Discussion

    Posted

     

    ATPGP, hairy 15% yield. At 50% of par, you get 100% upside to par, plus it converts at $22. I bought against my better judgement.

     

     

     

    I've put myself in jail after losing a chunk on atpg  ;). I vow never to touch their securities unless they file Ch.11, and only then will I look at their debt.

    Convertible and Preferred Stocks

    in General Discussion

    Posted

    Myth, I've sold ~80% of my ATPGP at high 40 & mid-50. At mid 50, they are not cheap given the default risk. Plus, what I see now is the management can keep milking the revenue with ORRI and NPI to survive and I am not sure if pfd will rank above those in case of BK.

     

    Having said that, I actually bot commons at mid 8 (ouch) and waiting for a home run. ;) With > 30k now and 45k year end, I see this a mid teen stock.

     

    For yield, I like FTR, SLF, SQR.UN.

     

    Note: SQR.UN's payout ratio is 140% so they can cut anytime.

     

    Forgive me but I don't understand the logic. You sold the prefs at ~50 because of default risk, and moved down the capital structure to purchase equity? If the stock heads up to the mid teens wouldn't you expect the prefs to be closer to par than 50? Maybe looking at a 75% return for the prefs vs about 100% for the equity and giving up the ability to take dividends and moving down the capital structure. Curious to know your logic.

    Kyle Bass Likely Made Nearly $10 Billion on Greek CDS Trigger

    in General Discussion

    Posted

    Appreciate the correction on the Gross vs. Net here.  I had thought what I had read was <$4B *gross*.

     

    If $70B is the Gross figure, I could see Bass being larger there.

     

    I also share skepticism of those who wonder about how accurate the Net numbers are, but after Lehman and Wamu went down, the cash trading hands in both situations was 4-7% of Gross as a data point which from what I recall was inline with the net #'s.

     

    Interesting to see what Bass makes here if he really is still holding some of this.

     

    Ben

     

    No worries Ben. I think $10b now is prob unlikely I am trying to get more info to get a #. What denominations do CDSs come in? Bc if they come in $100k units of $1m, we would know he at least made $65,-$650m

     

    Why are you consistently shooting first and asking basic questions later? It's like you're trying to create a National Examiner or US Weekly of finance.

    Asset Manager Recommendations

    in General Discussion

    Posted

    Hey Guys,

     

    I have a HNW friend who is looking for somebody to manage their money. Before you guys start nipping at the bait, she is looking for an a wealth manager, someone who can tailor an investment strategy that pairs well with her goals and risk tolerance. She asked me but what I would do is much different than what she would be comfortable with. Do you guys have any recommendations?

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