Mephistopheles

Can you tell us if a thread exists about it on the investment board? ;) Parsad you haven't answered this question, even though it's been asked twice! This leads me to believe that the answer is YES. :D

I get the impression that you are confusing actual "cloning" with idea sourcing. That is, copying what someone else does vs using what others do as a source for potential ideas. Why in the world would anyone want to pay someone else to clone? Why not just go to the original? I can't speak for anyone else, but for those who have invested in SHLD it would NOT be cloning Berkowitz unless they bought just because he did. You're talking about investing in things because others have, but confirming the data. There is a big difference between doing that and simply saying here is a list of 50 ideas that have been obtained from various sources. You have backtracked a little bit on your level of confidence. That's fine. You are clearly young and confidence comes with experience. For your own sanity and preservation, I believe you should not invest anyone else's money until you truly feel confident that any investment you make is a good one and not just because Pabrai or Berkowitz has made it. If you have doubts, then it won't be a pleasant time for you. Managing money is stressful enough. Add in a lack of confidence and the stress could be unbearable. I know it's been a month, but I realized I never replied, so I will now. You're right in that I confused cloning with idea sourcing. I certainly fit into the latter category of the two. While I never invest in anything just because a famous investor has bought in, I often look at their 13-F's for ideas. And while I am very confident that I can provide value for my clients, you are right in that I should be 100% confident in making investments for others in which no big investor is involved. I want to build more confidence over time, especially by learning more and more from this board. Hopefully at some point in the future I will be able to manage money for others with a lot more confidence. Thanks for your advice!

There are about 12 to 15 different series. Take your pick. The majority of mine are in FNMAK & FNMAM Interesting, thanks a lot

What are the ticker symbols for these prefs? :)

I use MerrillEdge. Terrible platform, but you get 30 free trades a month as long as you have $50,000 in your account and a checking account with Bank of America with a minimum balance (usually about $100).

Thanks for replies guys. Let me just say a few things. Firstly, I wouldn't tell my clients that I'm cloning, and def. not brag about it like Pabrai. Next, even though the term is "cloning", I'd still have all the research to back up the ideas, it wouldn't be plain cut and paste approach. It's not that I don't have confidence in my own ideas, as I'm doing well for myself. But for obvious reasons, I'd be far more okay losing my own money than someone else's. It's like, I personally am okay with investing all my money into 1 stock (and I have in the past), but I don't think I'd be comfortable doing that with client money. My main point here was that I don't want to sell the idea of cloning to potential clients, but rather do it for our own sanity, and to ease in our personal ideas slowly, rather then all at once. What matters most is that we provide the clients with satisfactory risk adjusted returns, and for that I am certainly confident. It's just a matter of how to get there. EDIT: Now that I think about it. Many ideas are cloned, aren't they? Like SHLD for example. Is it considered cloning of Berkowitz for everyone on this board who has invested?

I actually have a question unrelated to the legal/cost aspect. A friend and I are also pondering opening our own partnership. We do our own research, but once we open the fund, I think we'll be worried about trusting our own ideas initially. We are thinking that in the first few years we want to clone most of our investments, Pabrai style. Of course we would still reverse engineer and follow them like a hawk. But in the beginning we mainly want to buy stocks that Buffett, Berkowitz, Chou, etc. are in, to remain safe. Is this a sound strategy?

+1

:( http://online.wsj.com/article/SB10001424127887323899704578585953480399358.html?mod=WSJ_hpp_LEFTTopStories

Working on my poker game. :D However I did pick up some SHLD over the last few weeks as the price has deflated following earnings. But this is something that I've known about/researched for a while.

Would you mind sharing the name of the accounting book? :) Financial Shenanigans-- how to detect accounting gimmicks and frauds Ah thanks, I've always wanted to read this one.

Funny, as I read this I am studying for a genetics exam that I have tomorrow morning. Apparently there is innovation every single month in this field. I also happen to love chess, although I think Kasparov is a prick. I agree with most of the posters in this thread; innovation is all around us, and I would even say that in many cases it is increasing at an exponential pace. Now back to the slides. :(

If I remember correctly, he later admitted that it was a mistake not to sell KO in the late 90s.

Would you mind sharing the name of the accounting book? :)

I don't understand how Rajaratnam goes to jail while Cohen might get away with a deal like this...

Congratulations!!!

Or she knows that the vast majority of people who will watch the interview will want to hear about the economy and job reports and such, so she's doing exactly what most of her audience wants her to do. It just happens that it isn't what we would want her to do. In Warren's case, maybe. The majority of the people who see a Buffett interview want to hear what he has to say on the economy, or the stock market. I think in Munger's case, the people who are particularly interested in hearing his thoughts don't care to hear about the economy, and the people who care to hear about the economy aren't particularly interested in his thoughts.

Congrats Calonego! Btw, the word "flash" in the title is definitely a tease :P

if you have to dive in and take a close look he's not interested. he wants an investment to be obvious. he understands the numbers by reading the annual report. his accumulated knowledge means there is nothing new under the sun for him. that's why when someone wants to sell him a private business he can make a decision in hours based on his knowledge of the industry, the business, and a quick run through of probably 10 years of data. What I meant by diving in was that he reads the annual reports front to end, 10-Qs, conference calls, and competitors reports as well. I agree that the accumulated knowledge from doing this for his entire life can mean that he can now make many decisions without doing much research AT the time of purchase. Nevertheless, I bet he takes a very close look at SEC filings and conference calls of all his major equity positions, whenever they are released. This is how he discovered that Wells Fargo takes a $1.5 billion GAAP amortization charge that should not be counted as a real expense.

This surprised me: "That follow-up shareholder asked them about metrics and screening for stocks, and Buffett and Munger both said they don’t really look at numbers." I thought Buffett dives into the financial statements like none other.

If you don't mind, can you explain what is the deep moat and barriers to entry in this business? Thank you A combination of these factors which has historically kept new entrants out of getting into this business: > Exotic & somewhat rare tool materials (Tungsten, Cobalt, Tantalum etc.), high temperature processing which has lead to blurred lines between Science and art > Metalworking application specific development of tool materials (commonly called grades); As the world experimentsand develops products with ever newer alloys, the tool grade development has gotten ever so complex. It is a true web, and the way the web is weaved is learned only by those weaving it, and those are the few left in the field. (ISCAR, Sandvik et al) > The sales channels (closely tied to application development) is also a deep web of people to people selling, is part of the web-weaving. The cost of trying/switching out tool materials is not something many users are willing to take on. The combination of these factors and the skills based on experience makes it an "art" type industry where historically few have ventured into. I would like to hear from others who may have direct or indirect experience within this industry for their opinions. Thank you! Very interesting !

lol, asked for money to short with... So the BRK short is asking the CEO of BRK to invest money in his fund which is short BRK? Was he really expecting a yes?

Lol Doug Kass criticizes Buffett for not doing enough due diligence???? And for thinking of the BAC investment in the bathtub?! LOL "He wants to know what Buffett says about his research and process in making investments given there are legendary stories of his past due diligence, including of American Express, where he hired advisers. That contrasts to the $5 billion he put into Bank of America in 2011 which Buffett has admitted he decided in the bathtub would be a good idea and called."

Completely agree! In fact, I was thinking about making a post saying just this, but you beat me to it. Who cares what he thinks about the economy?! Personally, I would love to learn more of Munger's own investing style, or what his typical work day is like. There is so much more to learn from Munger than what he thinks of Ben Bernanke.

If you don't mind, can you explain what is the deep moat and barriers to entry in this business? Thank you