moore_capital54

Hey Guys, The level of fear is no different from 2008-2009. In the word's of Buffet, investors have truly "talked themselves into a funk" We are now past pricing in a recession and are pricing in a full blown credit crisis. The real value investor is buying hand over first, and maintaining exposure to equity markets. The other guys are waiting to time the bottom based on some pre-1971 historical metric that will never return due to money printing. There is going to be a lot of money printing here soon and keep in mind the last round of money printing didn't even reach the markets yet and has been prudently invested in treasuries. Homes are now extremely affordable, the savings rate is the highest its been in a while, interest rates are near zero and will "only" be there for another 2 years, this will get the greedy players in the game soon, S&P is trading at 9.9x 2012 earnings and a near 2% dividend yield, VIX has been over 30 for almost 3 months now, Europe hasn't even started to print money yet, and the Fed only starts to buy long-dated treasuries (money printing) this week! Fellow Canadians, we have been buying Le Chateau, which is literally being given away here. Owner Manager, Great Brand, and Fantastic Dividend. http://www.bloomberg.com/apps/quote?ticker=CTU%2FA:CN A few weeks ago I was sent this by an intelligent investor. I thought I would share it with the board as it may prevent some of the newer investors from reaching the stage of saying "maybe the markets are just not for me" http://simplerulesbooks.com/wp-content/uploads/2011/08/cycle-of-market-emotions.jpg

Parsad, I apologise if I offended you on your board. Based on the tone of your post it appears I did, so again, please accept my apologies. As a professional investor I decided to participate in this community, however there are obvious limitations about disclosing my identity or that of our fund. The OSC is very clear as to the rules and we are regulated, and I am quite surprised any hedge fund manager would engage in any banter on this board that would self-market his performance or appear to be soliciting investments. The rules are pretty clear, hedge funds are NOT allowed to solicit. And we don't need to, I joined the board to engage in stimulating discussions. So, if you feel my expressions or criticisims should be followed by a disclosure of my identity, then I will return to "View Only" mode on this board, as I still enjoy reading other's posts. Alpha - What can I say I must be an ass....

I have, hes a great investor as well. yet another value investor outperforming the markets...

I swear I didn't write this lol Wire: BLOOMBERG News (BN) Date: Sep 21 2011 0:00:01 Netflix’s Plunge Gives Tilson Pyrrhic Victory: Chart of the Day By David Wilson Sept. 21 (Bloomberg) -- Netflix Inc. has finally fallen below the stock price at which a hedge-fund manager made the case against the video-rental company in print and its chief executive officer rebutted him. Whitney Tilson, a managing director and co-founder of T2 Partners LLC, wrote about why Netflix was his firm’s biggest bearish bet last December on the Seeking Alpha website. Reed Hastings, CEO of the Los Gatos, California-based company, responded on the site four days later. The CHART OF THE DAY displays Netflix’s stock performance during the past 12 months, including its 38 percent plunge from Sept. 15 through yesterday. The chart includes the dates of the dueling posts, a CNBC interview in October in which Tilson said he was betting the stock would drop, and a follow-up posting he wrote in February after covering what was a money-losing bet. “We haven’t had a position in Netflix for quite some time,” Tilson wrote yesterday in an e-mail. He then commented on the company’s plan to split the DVD-by-mail business into a separate company, Qwikster, and to focus on online streaming. “This could pay off big time or be a disaster -- and anyone who claims to know for sure is deceiving themselves,” the New York-based investor wrote. For this reason, he added, Netflix isn’t a good stock to sell short or own. Tilson had bet against Netflix by selling short, or borrowing and selling shares, and buying put options, which increase in value when a stock drops. Netflix traded at about $230 a share when he covered and peaked at $304.79 in July. The stock closed at $130.03 yesterday after its four-day plunge, the steepest since 2004.

Before I get clobbered by the Mcelvaine supporters let me just spellout his performance for you: 2005: 17.21% vs 24.25% for his benchmark 2006: 11.90% vs 17.26% for his benchmark 2007: 0.56% vs 9.84% for his benchmark (unacceptable spread in my view) 2008: (48.75%) vs (33.01%) for his benchmark 2009: 18.07% vs 35.05% for his benchmark 2010: 1.75% vs 17.62% for his benchmark (unnaceptable spread in my view) 2011: (5.4%) vs (3.52%) for his benchmark Mcelvaine = Mediocre

I feel the same way about Denis Gartman and Tim Mcelvaine (Oh no I am really gonna get it now lol) Mcelvaine after Taxes has done about 20-30% over a decade.

Myth Plenty of people bought BP before Tilson and made a lot more money. Ned Goodman for example. Tilson just spent hours building a presentation with 100 Slides calculating how many trillions of gallons are in the Gulf of Mexico (Quadrillions) and spent several days posting on Seeking/Alpha and Fast Money. Tilson being right on BP did nothing for his investors, as evidenced by his performance. Ultimately, in this business all that matters is your performance. Do you make investors money ? Tilson has not for a decade so why do people think hes so great? Maybe he can be a professor at Harvard, or Columbia, I am sure a lot of guys on this board would pay $5-20k for a course he would teach.

$10 million is that magical point where you could just hang it in things like JNJ, collect $1,000 per day in dividend, and watch your $1,000 per day payout grow faster than inflation. Just ignore the advice about diversifying into bonds at that point. Depending on how cheap your thrills are, you can get by with a lot less without needing any fancy returns. $1m is certainly too tight, definitely need some skills or luck. We have a client who made $15mm selling a company and told me "That's just enough to keep up with the joneses" I thought he was crazy, as I agree with you that $10mm+ is enough for a lifetime.

I know a guy at UBS that lost over a billion. I know guys who have blown up in the last year. I know every single stock investor in the world and Tilson beat most of them. Benchmarking him against the best performing asset classes is another great idea! Why not benchmark him against Gold, or Apple? Shoot, I could of invested all my money, on heavy margin, in AAPL 10 years ago and done so much better than Tilson. What a loser, this guy. If you can't beat the Apple you shouldn't even be allowed to live... That's a fact. Hester with this kind of rhetoric you should consider a career in politics. Good luck to you with your definition of "better than average". It is a petty way of looking at things and is just wasting space on the board. Why are you even wasting time preaching definitions? The heart of the debate is whether Tilson is worthy of praise. I never once debated what better than average means, I took an issue with the statement by Parsad that only 50 outperform their benchmark by 3% over a decade and hence we should all "appreciate" Tilson's performance.. IMO Tilson is a dud as evidenced by a decade long track record. And for those not included 2011 when assessing his performance you guys are making a terrible mistake as he's currently down 24% based on what I hear.

LOL. I see both ends, Tilson's performance is nothing to write home about, but its by definition better then most isnt it? My guess is there is more to the story, MooreCapital is fairly involved in hitting Tilson. Action = Reaction, I started this thread with an intention of just hearing peoples thoughts, but was surprised so many defended his performance as though it was even worthy of defense :)

Ericopoly you are on my side on this debate! Great :) Makes my life easier. I know Parsad will return a rebuttal tomorrow AM that is usually how he does it...

I know investors that are retired businessmen, guys with 1-10 million that literally invest as their only source of income, and have been doing so for several decades. These guys have all had better performance than Tilson or else they would be eating into their principal. It's important for equity investors to also measure their performance net of tax and many fund managers fool their LP's with their numbers which most of the time include significant portion of gains charged as Income. Tax-Free bond funds have been delivering 5 % a year fairly easily, tax free. Compounded over a decade that blows guys like Tilson out of the water, with no volatility and less risk.

Two quotes pertaining to the viewpoints of the Tilson supporters on this board: “It ain't what you don't know that gets you into trouble. It's what you know for sure that just ain't so.” “The great tragedy of Science – the slaying of a beautiful hypothesis by an ugly fact.” You can manipulate the data however you like, adjust for good years or bad, but the bottom line is: Tilson = Mediocre hedge fund manager, and average Mutual Fund manager or in other words, nobody we should even be discussing on this board, and definitely not someone the media should be paying ANY attention to based on his performance.

Hester, that statement seems a tad emotional and lacks the demeanour I would expect from a debate that seems to be leaning my way. Since posting the Poll, 8 human beings on this board have confirmed that they have been able to beat their respective benchmark by a margin of 3% over the last decade. My comments towards tilson are based on facts, Tilson hangs out in circles with Super investors, and tries to proselytise value investing as though he is the leader of the pact (IE: VIC) when in fact, he damn well is a disgrace to value investors. To me personally seeing the NFLX Debacle was the nail in the coffin. August was no surprise to me, as he always "tries something new" so this time it was a Macro call. His performance is just terrible, and I can't believe some of you think otherwise. If you truly sit here thinking a 33% return net of taxes over a decade constitutes alpha in any environment than you are dreaming. I would rather spend my money on booze and women than leave it with a manager that spends too much time proselytising and no time performing. I think my analogy of the nerd at the gym is the best for Tilson, or the Bat boy, or even the Caddie. He's got no swing but can talk your brain off.

Total fake in my humble opinion. A decade is plenty for a value investor or any investor for that matter to demonstrate if they "have it". If whitney ends up riding a rally and getting back on top, it's only due to the heads I win tails you lose structure he has in place and his celebrity in the industry. If he was investing his own capital, he would barely have enough to make living expenses with his performance.

I attached Ansons performance over the same period as Tilsons: 2008: 1.7% 2009: 19.61% 2010: 23.27% 2011 YTD: 20.76% Larger AUM than Tilson. Net of Fees. Plenty of guys like that you have never heard of because they spend their time looking for alpha and less time marketing or holding conferences or 200 page presentations and blog posts.

Put it to a poll!

Hell I am sure there are 10-20 guys on this board (at least) who have generated superior returns to that metric over the last decade. Otherwise I wouldn't have joined this community!

Whos? Also Parsad, when you said 10,000 Managers you obviously mean the pool of global hedge fund managers which includes all asset classes.

Parsad claimed that out of 10,000 hedge fund managers, only 50 will beat the index by 3% or more over a decade. I say the number is at least 200-300, if not higher.

Parsad your post sounds like "excuses "excuses "excuses" to me. your rebuttal as to why I was able to name 8 managers in a heart beat who completely obliterated a criterion you thought only 50 people would meet, is simply inadequate. You are making ridiculous assumptions such as "insider information" or worst you are saying that the single most important indicator in this business (PERFORMANCE) has nothing to do with skill? And relating to those Distressed debt guys, so what? Are you adjusting your statement to cover only managers per each asset class? That is ridiculous, Tilson buys CDS and distressed debt when he wants to? And no distressed debt benchmark delivered a CAGR of 32% like these guys did. Nobody is placing a gun to Tilson's head and forcing him to deploy in equities case in point: just as he dabbled in Macro he can dabble in distressed debt. I assure you that he has deployed his capital in asset classes he felt would deliver the best returns possible, not the best within an asset class. You guys should look at the competition more often, instead of finding solace in completely mediocre performance. People are getting rich left and right delivering superior returns. Look at Ted Weschler who nobody ever heard of, there are hundreds of guys like him, if not thousands. We recently put some money with 3 young kids from Toronto: Anson Capital. Look at their returns over the last 4 years. Incredible. Look up James Melcher , Look Up Erez Kalir of Sabretooh, so many I can think of that have delivered returns exceeding 3% of indices (or their benchmark for that matter). Keep in mind, hedge funds are different from Mutual Funds. In the Mutual Fund world, your statement might hold water. Not in the hedge fund world where we literally get paid 2% just for the privilege of managing others hard earned capital. In the hedge fund world, Tilsons performance is crap and falls into the category of mediocre at best.

Parsad what do you mean, rip apart their portfolio. Either they are superstars or their not: Loeb, Einhorn Ackman Bass, are they not superstars? Soros Druckenmiller Caxton Tudor Jones?

http://www.groupgcapital.com/ These guys who I have never heard of delivered 32% CAGR over 5 years lol

Here is the excel file with the 441 funds for those interested. I have no doubt there are at least 200-300 managers in the world who have audited track records that deliver a return exceeding 3% margin of indices over a decade. I can think of so many off the top of my head. I think that stat is outdated and relies on something Buffet said in relation to a 20-30 year career, in which case it's obviously more difficult. But over this specific last decade, making money was like stealing candy from a baby. I can't believe managers that did not get rich between 2003-2007, at least temporarily before the drop. Take Pabrai for example. Every dollar in his net worth can be attributed to that period. Had that period not existed his performance is tepid. But he is a perfect example of someone that took advantage of the good times, and is preserving (at least his carried interest) during the bad times. 5year_annualized_over_20.xls 5year_annualized_over_20.xls

I just did one for shits and giggles. I found 441 Funds on Bloomberg that delivered a CAGR of 20% or more over the last 5 years. I can't do 10 years, but will find a way to do it tomorrow. And keep in mind Bloomberg doesn't have access to all funds, IE: Non listed funds like Greenlight. I think your numbers are way off. There are hundreds of Managers that have outperformed the S&P by over 3% over the last decade. I can name 20-30 of which I personally know a dozen or so. We did it as well, and we are a small time fund out of Toronto that nobody has ever heard of.