nkp007
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Posts posted by nkp007
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Newsflash, how many value investors at the top of the Forbes 500 list too? Some will claim Buffett, but I'd argue he got there by building a business not pure investing.
I think this sort of video is infuriating to investors on this board because most put in so much work for returns far less then her. I don't get the technical stuff, but if it really is as easy to watch squiggles and make money for some people why learn any more? It's not like knowing depreciation schedules or pension accounting is helpful in getting a significant other. Can you imagine someone saying "Once I brought up LIFO at dinner she said I was the one…"
I invest this way because it makes sense to me, not because it's the best. I think there are far better and quicker ways to make money, unfortunately that's not what comes natural to me.
I used to date a girl who would get turned on by finance talk. She herself was in finance, but knew little about investing. But she could listen to me all day and it would be sexy for her.
Dude....why didn't you marry her???? ;)
She wouldn't sign the prenup.
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How much does Mergent cost? It looks great, but after hunting for the subscription costs and not being able to find it, I'm guessing it is very expensive.
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What are the people in the media bragging about her,... a new teenage Hollywood wonder girl,... somehow just listening to her for only 2 minutes give me the goose-bumps. Sorry,... but if I hear the word "trade", trading on instincts, on trade on technicals,... my mind freak's out the opposite direction,.. like a torero's red rag to a bull,... my mind would slap them Bruce Willis'like in the face, feeling I have the most stupidest person in the world in front of me,... grrr. I bet if you asked her about deeper fundamental accounting and legal terms, beneath BV, IV, PTPP, she has no clue. How many silly school children think they can have such an edge in the market. No one at the top of the Forbes billionaire list has become rich through day trading, Lampert & Berkowitz (not a member) have gone through investing with intensive "stalking the facts" of the fundamentals, having their assistant's go through piles of paperwork, public filings, legacy issues of legal perspectives. And there comes such a weird actress thinking she might be smarter than Buffett, Munger or mathematician Jim Simons. She is not even in the league of smartie Danika McKellar. But what do I know....
Newsflash, how many value investors at the top of the Forbes 500 list too? Some will claim Buffett, but I'd argue he got there by building a business not pure investing.
I think this sort of video is infuriating to investors on this board because most put in so much work for returns far less then her. I don't get the technical stuff, but if it really is as easy to watch squiggles and make money for some people why learn any more? It's not like knowing depreciation schedules or pension accounting is helpful in getting a significant other. Can you imagine someone saying "Once I brought up LIFO at dinner she said I was the one…"
I invest this way because it makes sense to me, not because it's the best. I think there are far better and quicker ways to make money, unfortunately that's not what comes natural to me.
I think value investing is a misnomer. What most of us on this board do is "opportunistic investing". And over the long-term, I have confidence that good opportunistic investors (which I would argue is exactly what most of the wealthiest people on the planet do) significantly outperform everyone else.
No one is infuriated by this girl. I think most people here would probably be infuriated that the notion her newfound success somehow even slightly threatens what we do.
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Bloomberg : Carl Icahn Reports Herbalife Stake Equal to 12.98%
The investing world's equivalent of "Reality Television"
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My prediction: he's going to surprise everyone and sell a long-time holding. A bittersweet, yet necessary farewell.
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This got me thinking, I'd love to read a book on the history of GEICO.
Found this: http://www.amazon.com/GEICO-THE-FIRST-40-YEARS/dp/B002SIFA4I
but I have no clue what would be inside of it.
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Massively net short. This market is crazy within the context of a secular bear market. Sentiment is at extreme optimism, VXO is at multi-year lows, valuations are at extreme highs and the Citi econ surprise index has rolled over substantially. I can't think of any reason why this market should decline....typically a sign the market is peaking. Can't wait to be able to pick up AIG at $30 and BAC at $9 again...
We're still relatively close to those levels for AIG and BAC. If they're worth multiples of current price, a 20% move still leaves plenty of a margin of safety.
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As far as $BAC and $AIG are concerned, I still think they are cheap. Used the rest of my cash yesterday to close out my Salesforce short at a loss :( and plug the liquidity into more warrants.
Virtually no excess cash, and just waiting and holding.
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If your last name is Patel, hotels are literally THE status symbol in the community.
Regardless of economics, regardless of quality, regardless of location, all that matters is how many "beds" you operate.
E.g. Mahendra, please meet Rupesh. He owns or joint-ventures in 5K rooms in Florida, Alabama, and Texas. He is the man!
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I think Fairholme will simply close the funds. Nothing else.
A closed-end fund sufficiently serves the purpose of turning the holdings into permanent capital.
But people can still pull out. All it means is that there will likely be more outflows than inflows, correct?
a closed end fund trades like a stock. the capital is essentially permanent. They'll trade above, at and below nav.
I don't think this is what is happening.
I think he is closing his funds to new investors. That is different from turning it into a closed end fund.
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I think Fairholme will simply close the funds. Nothing else.
A closed-end fund sufficiently serves the purpose of turning the holdings into permanent capital.
But people can still pull out. All it means is that there will likely be more outflows than inflows, correct?
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Is one legally allowed to run a hedge fund and a mutual fund at the same time?
I wonder if that's the plan. Let the mutual fund capital slowly run-off, try and coax the big holders into a hedge fund structure, and one day pull the plug on the mutual fund.
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Have no fear. Existing investors can still purchase shares whenever they want. So buy some shares now, and a million more in five years.
"Effective as of the close of business on February 28, 2013, the Funds will suspend the sale of shares to new investors, including new investors seeking to purchase Fund shares directly from the Funds or indirectly through financial intermediaries. Shares of the Funds will remain available for purchase to existing Fund shareholders. Each Fund retains the right to make exceptions to the suspension of the sale of its shares to new investors, and reserves the right to subsequently commence selling its shares to new investors. Investors may request information by calling Shareholder Services at 1-866-202-2263."
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Is it just me, or does this sound like a basket-case?
Annual Gross revenue of $500k/365 days per year = $1,370 per night.
Nightly gross of $1,370/$100 nightly room charge = 13.7 rooms occupied per night
Nightly Occupancy of 13.7/60 units = 22.8% average occupancy rate?
What doesn't add up here?
I'm guessing the area this hotel in isn't $100 per night average rate, not that it matters much. If it were $75 per night we'd be talking maybe 1/3 occupied, and for $75 unless this is an extremely rural area I'd be worried about damages from guests.
To someone else's point maybe you're not looking at the right books?
The real world investments are fascinating. Ultimately the price is 9x cash flow on this thing for a private illiquid deal. This speaks volumes, especially when I see a stock trading at 3x FCF and someone tells me the price is appropriate because the stock is illiquid.
I've looked at a ton of hotel development deals. There are three things I generally dislike about them:
1) Heavy price competition. Hotels (within each tier) have very little pricing power.
2) Required capex every seven years or so for franchised hotels
3) Heavy debt loads required for decent returns. Many people tell me their goal is to operate breakeven on a cash flow basis and profit when they sell it. I don't know...
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Bank of America is one of the most leveraged ways to invest in American real estate.
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That was rude.
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I assume this will be put on youtube...!
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So assuming there's nothing worthwhile to short right now, when this bubble pops where should we be looking for values?
Brookfield Real Estate Services?
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Like I said, dumb money now coming into BAC. Jim Cramer likes it and his target price is $18. Cheers!
Christ. The Mayans were right.
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One aspect that I'm missing a bit in this discussion a bit is that the amount of concentration should imo for a large part be a function of the idiosyncratic risk in a certain investment. You could have an awesome investment that still has a 50% probability of going to zero. Wouldn't make sense to put all your money in your best idea, if this is your best idea, no matter how big the upside. If you have on the other hand a super solid and safe business it might make sense to put a lot of money in it even though it's going to return a lot less on average than the business with binary outcomes.
Concentrated investing forces you the discipline of avoiding fliers, coin tosses, and lottery tickets. Also it self-regulates the amount of cash to have available for the once in a lifetime opportunities that seem to becoming more common not less so.
I also like about concentrated investing, that there are always tempting but distracting crappy leveraged companies available but they involved too much psychic attention for my taste … they bring with them too many surprises, and surprises are usually bad.
It adds a nice filter for me. I ask myself, would I be willing to invest 25% of my fund into this company? If the answer is a quick no, then I save a lot of time by moving on.
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I only invest when I'm really excited about an opportunity. I don't make opportunities that I'm excited about a 2% position; I put as much money as I can into it. It fits my personality, but not everyone can invest this way. It comes down to your personality, depth of research, and the kinds of companies you invest in (e.g., wide-moat companies vs little downside protection).
It's popular because it's understandable. It's understandable because everyone sees or owns the products.
I don't think Apple is understandable at all. It's too difficult to figure out how profitable the company will be in five years because the products it will be selling then do not yet exist. I think Apple could belong in a diversified portfolio, but not a concentrated one. Too much uncertainty. Just my two cents/brief tangent.
You're right. I should have said:
It's popular because its products are popular.
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Apple isn't even that good of an investment. what is the upside? Best case scenario a double? Worst case scenario its market share starts to erode in the hypercompetitive space it is in and it falls in intrinsic value quickly. So, medium-high risk for medium-high reward. Not asymmetric at all.
It's popular because it's understandable. It's understandable because everyone sees or owns the products.
Wait, what were we talking about again?
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Klarman's thoughts from the 2008 Graham & Dodd Breakfast:
“It seems to me that, as we know, you diversify most of the diversifiable risk away from a portfolio by owning 20 or 25 positions, and that if one is able to tell a good investment from a bad, one should be able to tell a great investment from a good. So I see no sense in having the same size position with your best idea and your hundredth best idea to round out a 1% idea type of portfolio. When we take a concentrated position, I’d say a dozen times over 26 years, we have had a 10% or so position. It also depends on the definition: Is a position in a type of investment a position or is it only a particular issuer? So a little definitional clarity might also be needed. But in general, in one particular company’s securities, every 2 years or so we have a 10% position. Most of the time, we have 3, and 5, and 6 percent positions as our most favorite ideas. We will take them higher when a cheap position becomes much, much better a bargain or when there’s a catalyst for the realization of underlying value. We favor catalysts because it gives you a much shorter duration on the investment and greater predictability that you will in fact make money on that investment and aren’t subject to the vagaries of the market and the economy and business over a longer period of time. So we would not own a 10% position in a common stock that was just plain cheap unless we had a seat on the board and control, because too many bad things can happen. But we’d own a 10% position in a senior, distressed debt investment where there was a plan in place, where the assets were very safe – either cash or receivables or something where we could count on getting our money back, and where we saw almost no chance of principal loss over a couple of years and a chance of a very high, meaning 20% plus, type of return. So that’s how we think about it. I think when people make mistakes, it often is on both sides of diversification. Occasionally, new managers especially, that aren’t that experienced in the business, will have a 20% position or perhaps even two in one portfolio. And those two might even be correlated – [i.e.] same industry, [or] the same exact kind of bet in two different names. That’s absurdly concentrated; maybe not if you have enormous confidence and it’s your own money, but if you have clients, that’s just not a good idea. But 1% positions also are too small to take advantage of what are usually the relatively few great mispricings that you can find. When you find them, you do need to step in and take advantage.”
Concentration is definitely a double edged sword, and a dangerous tool in the hands of an inexperienced investor.
E.g. My 40% position in Research in Motion when I started out. That's a lesson I won't ever forget.
Micro Caps and Buffett's >50% returns
in General Discussion
Posted
With only $1mm, he wouldn't have access to the derivatives market.