oddballstocks

I think it should matter in the sense of being generally aware of the market. If the market as a whole falls everything falls, not just the overvalued stocks. So being aware that we're in high territory helps keep a sane head, likewise when everyone was panicking in 2009 the Shiller P/E was a helpful indicator to reinforce that stocks are cheap. Sure they could get cheaper, but for all the dire outlooks they were cheap. Also some of us aren't full time investors and are saddled with index or mutual funds in retirement accounts we can't control. When the market as a whole gets higher I lighten my stock allocation, when the market's cheap I load up. Shiller P/E doesn't drive any of my non-401k investment decisions, but it is a helpful stat to keep in mind.

I understand Canada can print money, the US can as well. The article is talking about the technical details on how a recap might work. In the US we issued TARP shares which were maybe created with funny money (unsure). In Canada it appears the approach is instead of a capital injection the government will turn liabilities into equity. If a bank is levered I would imagine the debt would become equity first. If a bank weren't levered their only liabilities would be deposits, in which case the scenario is similar to Cyprus. I doubt this is intending to hit insured depositors. I know in the US I was presented with an account through a brokerage where if I had my wife's name on the account behind the scenes the broker would shuffle banks so my cash could be insured into the millions.

Norm, I understand your point, and I hope your right, but on a bank balance sheet deposits are liabilities. So if they're thinking of turning liabilities into equity they're only left with a few options, deposits, or debt. I'm sure debt would be the first step, but depositors could be the second. I agree that seeing the actual legislation is probably the best step. I'm not sure how Canadian politics works, but in the US there are tons of bills presented that never make it past an initial vote.

I completely agree, when used correctly computers are great tools. I don't know why it would be hard to just turn off the monitor, he wouldn't see quotes or see newsflow. If he really wants to make sure he's clueless about his portfolio he should take my approach, get a full time job, then work from home with two little kids. In between conference calls and helping out my wife during meltdowns I'm unaware there's even a market. If someone came and told me some stock I owned dropped 50% while I was wrangling with a melting down toddler I'm not even sure it would register. I don't know why fat people don't get thin, they'd just need to eat less. While you jest it is true. If someone were fat and they reduced their caloric intake to 500 or 1000 calories a day they would lose weight, that's not up for dispute. This all boils down to self-control. Why do some people spend all day on Facebook, or Twitter or corner of ber….uh...

A friend sent this to me: http://globaleconomicanalysis.blogspot.com/2013/03/canada-discusses-forced-depositor-bail.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+MishsGlobalEconomicTrendAnalysis+%28Mish%27s+Global+Economic+Trend+Analysis%29&utm_content=Google+Reader The basic gist is in some new bill in Canada legislators slipped in a provision similar to what they did in Cyprus. The regulators would be able to turn certain liabilities (deposits) at a bank into regulatory capital quickly in order to keep the bank solvent. I never thought the Cyprus solution would be a one off, it's disheartening that Canada would be willing to put this in place "just in case". I wonder how long it'll take for a similar provision to migrate south of the border?

I completely agree, when used correctly computers are great tools. I don't know why it would be hard to just turn off the monitor, he wouldn't see quotes or see newsflow. If he really wants to make sure he's clueless about his portfolio he should take my approach, get a full time job, then work from home with two little kids. In between conference calls and helping out my wife during meltdowns I'm unaware there's even a market. If someone came and told me some stock I owned dropped 50% while I was wrangling with a melting down toddler I'm not even sure it would register.

Surely, you jest, Oddball. :) But what you said reminds me of a Walter Schloss interview done by OID in either late 80s or early 90s. It was mentioned that the interview took the whole afternoon. The phone rang once during the interview. While picking up the phone, Schloss commented, "It must be my wife. I wonder why she calls." It turned out to be caller who had a wrong number. :) Yes, all humor, sorry if it doesn't translate well online.

In other news he's also getting rid of his telephone and switching to carrier pigeon, he was receiving too many calls and they were distracting. He refuses to communicate via email and prefers to hand write letters with a fountain pen. He states the fountain pen slows him down forcing him to concentrate on one letter at a time. Commuting has taken on a whole new meaning once he switched to a more fuel efficient mode of transportation, horse and carriage. He was quoted as saying "A bale of hay is far cheaper than the gas for my Prius, and I know a farmer who will give me a discount if I help wash tractors every other Saturday." While traveling to work in his wagon it gives him time to contemplate where he might buy his next top hat from, a respected value investor is never without their top hat and cane...

It's called The White Sharks of Wall Street, about asset based activist investors in the 1940s-1960s.

Just to be contrary, I'm reading a book that's talking about some investors in the 1940s-1960s, and they're talking about how companies were flush with cash from the war effort that it set off an M&A streak. The companies fattened up on increased demand from war supplies etc. So war can be very profitable and doesn't always lead to a crash.

boilermaker75, great post! I learn well by reading, it's probably my preferred way to learn. But that said being able to talk to someone about a question and have it answered and explained in person is priceless. I can't imagine that good teachers, who love the material and are experts on the material will ever go away. The lazy ones who are reading from the book might be upgrading their classes by going online. I also found in class some of the most interesting lectures or infomation was when the professor would get slightly sidetracked and dive into something they were passionate about related to the topic. The material would never appear on any test, but the knowledge was certainly valuable.

I'm with everyone else, go for the quality of life. If you want to be closer to the nightlife and you value that then go for it. I worked from home for a while then was "promoted" and had to start going into the office more. I put promoted in quotes because while my role became better the quality of life negatives outweighed any career positives. Being able to start working at 6:30, running at lunch, and being done at 4pm and ready to play with the kids at 4:01pm is much better than anything a job could offer. Now I get up at the same time and get home at 5:30, losing 1.5 hours a day to sitting on a bus or wasting fuel in traffic.

...If you could open such a fund with fees below 1% let us know! I'd be happy to invest! But you are right. Let's say you would have to make 100K/year in profit at minimum to make it worth your time... then you would need probably $20M AUM assuming 100K expenses and a 1% fee. At this point you may have too much cash to deploy into the strategies unless you had multiple funds with different strategies. global microcap MF, global net-net...and more. I guess it just might not be feasible (yet)? More likely, you'd need 2 people running the funds, contract out your accounting and legal expenses etc. It starts to look daunting without a performance fee, but then that defeats the purpose. Most people who would invest in a microcap netnet fund "basket" could do it without paying the expenses associated with a performance fee. Just hit Graham investor, or a Bloomberg or whatever and buy away. Then if you start actively managing it, if you are charging the currently insane management fees of hedge funds, all the outperformance would just go in your jeans, as opposed to customers. Still, not all cheapo startegies that work are in microcaps, and I haven't found many ETFs that are truly cheapo strategies in my opinion. On a different note, one of the best sources of ideas for me comes from ranking microcaps by EV/EBIT and ROIC on the Bloomberg. If MF no longer works well on huge stocks, it certainly still seems to identify winners like JCTCF in the 20-50 mill category. You basically described why I haven't done this yet, the numbers just don't work well. To make a reasonable salary after expenses requires an AUM that's higher than could be reasonably deployed in many of these stocks. I've come to realize if one wants to do well on an individual level small and microcap stocks offer the best opportunity. If one wants to do well as an asset manager they need to slightly outperform the market and raise capital like crazy investing in mid-cap or large-cap stocks.

This is a good one, and as CEO he has fiduciary duty to shareholders to make sure that we aren't taken advantage of. What's an example of an acquisition that appeared better on paper but the results never materialized in reality? What changes have taken place since that acquisition to ensure it doesn't happen again?

What I would love to see is something along the following lines: Take all of the lost revenue from newspaper advertising and sum it, then compare it to the revenue that the online advertisers over the same time period. My theory is the lines would be moving in opposite directions, yet in dollar terms I wonder if it's a 1:1 or if Google has found a way to make more or less than newspapers?

This is 3 year data, hardly statistically valid. In fact given the tumult, I would expect something like this during this period. That said, to me MF is a beginning, it gives companies to analyze. Whenever I hear this response I wonder how long is needed for something to be statistically significant? I've heard people claim 120 years of market data isn't enough to show stocks outperform bonds at a statistically significant level. I agree Nate, but in the case of a long term quantitative investing strategy, wouldn't it be best to look at the performance over a full market cycle at least? If we only look at the run up since 09, you could conclude that buying "high beta" glamour stocks is a great strategy, netnets are horrible, etc. Given the rationale behind the MF, I believe it will outperform a comparable index over a full market cycle as backtesting seems to indicate, even if real world performance falls short of the backtests . Almost anything with a cheapness metric in its ranking should outperform over time I think given you buy enough stocks for general diversification. I don't see how adding a quality criteria to that could be a bad thing. Personally, I do believe the MF is one of the best strategies out there if you aren't a stock picker. Adding a z-score, and/or f-score to the ranking might help avoid some real traps as well. If you are a stock picker (I am) I think you have to ask yourself if the marginal time spent is worth any out performance you might achieve over a strategy like this (instead of just the index)... or maybe you just enjoy it! I do :) I still can't believe no super value ETFs exist... straight low fee (sub 1%) 30 stock MF ETF, every netnet under 66% NCAV with acceptable z-score ETF over 25 mill, all P/B below 1 f-score/z-score over a hurdle (not Chinese) ETF etc. I would consider putting the majority of my money in those if they existed, and only pick a couple stocks outside of that. Maybe it isn't feasible for the really small type strategies above due to liquidity, but certainly a cheapest decile ev/ebit, or p/b S&P type index could exist. Thanks for the response, I didn't realize the results were just the mutual funds since 2009. I've been following the strategy through the Yahoo! Group since 2007, people have had real money invested in this since the 2006 timeframe and their results mirror what others have said on the forum, it outperforms but not by much. The participants were slaughtered in the 2008/09 downturn, most couldn't stick with the losses. Even in the recovery the stocks didn't do well. What always troubled me was that out of the 20 or so results given an investor had to pick randomly a few stocks each quarter. It seemed reading the newsgroup that investors had a tendency to pick the losers even if their picking was random. A few had devised systems that improved upon the formula by including simple non-intuitive checks. A lot on the group were (still are) using technical analysis to try to avoid the falling knives. I know many took losses on the Chinese stocks as well. Once that sector tanked they mysteriously disappeared from the lists, small consolidation to the investors who lost real money with them. I think the difficulty with a deep value ETF is the liquidity. Investing in a lot of those types of stocks is feasible as an individual with smaller amounts of capital, but I can't imagine trying to move $100m through the sector. How do you possibly buy stakes in companies like Northfield Precision (a deep value net-net with a $3m mcap)? Especially when shares trade by appointment. I have thought about the feasibility of opening simple value funds, buying a bunch of net-nets at 2/3 NCAV or something. The problem is it's hard to raise money for a fund like that, what investor wants to buy into 100s of Japanese stocks? Or lots of tiny microcap stocks that barely trade? There's a reason so many funds have the term "growth" in them, and so many value funds are mid/large cap GARP funds. It's much easier to buy growth cheap than to actually buy value stocks in size.

This is 3 year data, hardly statistically valid. In fact given the tumult, I would expect something like this during this period. That said, to me MF is a beginning, it gives companies to analyze. Whenever I hear this response I wonder how long is needed for something to be statistically significant? I've heard people claim 120 years of market data isn't enough to show stocks outperform bonds at a statistically significant level.

Good interview on the situation: http://www.businessweek.com/articles/2013-03-19/a-cypriot-nobelist-appalled-by-the-bailout-bank-tax#r=hp-lst

Kiltacular's post was important: namely the part that the best assets in an inflationary environment require little capital expenditure. So you can sell inflated goods without having to spend on inflated maintenance capex. Being tangible asset light with pricing power are the best businesses in inflationary times. These are the cokes and see's of the world. In private business the goal is to create operating leverage. Like previous posters have mentioned getting a rate fixed now and then paying off the asset with cheaper dollars in the future is a great plan. That being said if people believe the endgame is crazy high inflation then waiting til that manifests and buying real estate is a home run. Also service based private businesses with little tangible assets would do well only if you are considered the "expert" in town. An expert can easily increase prices while slightly increasing demand or keeping it relatively fixed. Due to competition if you are not considered one of the best i dont think inflation would be your friend. Due to obamacare there will be a shortage of doctors due to increased demand of people getting healthcare. This seem like a good profession but, insurance companies are combating that with reinbursing doctors less money per service rendered. In the end doctors will have to much work harder and render way more services for a bit more income. I think the problem with the asset-lite company that can raise their prices is they can be hit by a demand slump. In a perfect world with high inflation where workers wages keep up this isn't an issue. Unfortunately wages don't keep up and workers get squeezed, that's why inflation is difficult. When inflation is high people start to cut back on non-necessary items, I would think Cokes and See's candies would be in the discretionary purchase category. I don't think there's a good investment in an inflationary environment. I don't think it's anything anyone should ever hope for either. Outside of the wealthier who own companies resilient and have ample cash most citizens are seriously harmed by inflation. If inflation were a good investment people would be flocking to Argentina right now to capitalize on their rampant inflation, instead money is trying to escape, not get in.

Question...do you think TIPS will be adequate to hedge this type of event? I have a small %age of my portfolio in vanguard's TIPS ETF, however I am a bit non-convinced that it will actually function correctly as a hedge if S.H.T.F. Specifically I am concerned about a lollapalooza effect. If inflation occurs suddenly and unexpectedly, will the pent-up inflationary pressures be so great that no matter the level of TIPS exposure, will drastic increasing inflation will make the dollars worthless? Or do you think foreign holdings or commodities (see: gold) would be a more adequate hedge against drastic, sudden inflation? I'm not moore so I can only speak for myself. I'm worried TIPS won't capture all of inflation. Right now TIPS are saying there is very little inflation. Yet antecdotally what we're seeing in my household, and with everyone we know (upper middle class young families in 30s) everyone's budget is tight. No one's pay is going up and expenses are rising fast. It isn't one specific category that's rising, it's an across the board rise. We've had to alter our budget a few times now, what comes next is either I find more sources of income (which I'm working on) or we cut back on our savings. Most of our friends have zero extra sources of income, so savings takes a hit. The problem is what I'm seeing when I talk to people is not reflected in TIPS pricing. This leads me to believe that market dynamics are stronger than the actual inflation dynamics, or the measurement is wrong. I'm worried about inflation, I'm also worried about the dollar becoming worthless. I diversify internationally, I have Yen, Euro, Pound, Franc, I had some NZD for a while. I like having non USD holdings, if something were to happen to the USD I would at least have something left. I don't have any hedging plan, and I don't think wealth can ever be completely protected. My goal is that if SHTF scenario I will come out with something. Maybe 10 or 20% of what I had originially, but 10 or 20% is a heck of a lot better than 0%.

You could programatically get it by scraping the data off the edgar website. I usually use python for stuff like this but it could be easily adapter to other languages. This code (in python) takes the ticker in the variable "ticker" and the fetchs the company data page from edgar, parses out the CIK. import urllib2 import time ticker = 'BAC' string_match = 'rel="alternate"' url = 'http://www.sec.gov/cgi-bin/browse-edgar?company=&match=&CIK=%s&owner=exclude&Find=Find+Companies&action=getcompany' % ticker response = urllib2.urlopen(url) for line in response: if string_match in line: for element in line.split(';'): if 'CIK' in element: cik = element.replace('&amp','') print cik Woops this does the opposite of what you asked for. Could do the reverse easy as well. Happy to post an example after dinner for getting the reverse if you want/need it. Yes I'd love to see this in reverse if you have a chance, thanks! I was going to post this on StackOverflow. It realized it's more of a business domain problem than a coding one. You guys knew exactly what I meant, this forum is awesome!

I don't think there is a clean and easy solution. The CIK is a unique key for entries in the SEC database, but I think you also get a CIK number if you for example file as an individual a 5% position. And the SEC doesn't care about ticker symbols. That something between companies and exchanges. So you either need to build your own database or find someone who has done the work. Probably not available for free... Correct, as of this quarter there are 65000 CIK codes, but I already have them filtered down to around 5000 ones that I know pertain to what I need. The problem is as you state, the ticker is an exchange mechanism and the SEC could case less. There is one possible extremely clunky way which is this. When a company files with XBRL the standard naming convention is TICKER-date.xml. This is in the zip files linked from the SEC XBRL feed. The problem is I can't get the historic zips from the SEC because everything historic is stored on the FTP server in a different format. The format is passable, but doesn't contain the tickers. The problem with using the RSS feed is it would take up to six months to build this as companies file. And I wouldn't have any historic tickers. There are no paid solutions that I can find either, but I can build this myself, no need to pay.

Thanks but I already have the CIK, I'm trying to get a ticker from the CIK. The SEC has a master file updated nightly on their FTP server with every company and the associated CIK. But no where in anything (filings/XBRL) do they have the ticker listed, that's the problem. I can get a list from NASDAQ but I'm left to string matching and it isn't very accurate. I get oddities like Apple Community Bank getting the ticker AAPL, and there are too many to manually look up in Yahoo finance by a human.

I'm looking for a way to find a ticker for a stock if I already have a CIK. The SEC is CIK driven and I can't seem to find a link between the two. Does anyone know of a list that's updated frequently with a CIK and associated ticker? I have already surfed the SEC's FTP server without luck. If not any idea on how to get this programatically? On a side note can somebody explain the SEC ascention numbering scheme?

I just got back from the bank, I took out a new mortgage on the house and rolled it into BAC LEAPs, am I ok or late to the party? I leveraged my leverage, I can't wait to be rich!