Yesterday I doubled my capital for the first time

[giofranchi]

But perhaps there was a flaw in my thinking or are the numbers in italy so much different?

 

frommi,

I think you are right, but a company has ways to defer the payment of taxes an individual doesn’t enjoy. That’s basically why I prefer this solution to distribution of earnings via income.

 

Gio

 

[giofranchi]

"There is only one success - to be able to spend your life in your own way." - Christopher Morley

 

Exactly! ;)

 

Gio

[cobafdek]

Le più sentite congratulazioni!

 

Do these returns include your real estate holdings?  How is the total return on real estate?

 

(Pardon my fixation on your potential Liguria idea . . .)

[giofranchi]

Do these returns include your real estate holdings? 

 

Not at all... Our family real estate holdings have nothing to do with my firm, nor its equity, nor how it has grown over the last 4 years...

 

Gio

[muscleman]

I'd be interested to know your biggest winners and positions.

Also, I'd love to know your portfolio today :)

 

I have at least doubled the capital invested in VRX, ENDP, and Third Point Offshore. I have made a lot of money with LMCA and OAK. I also have more than 150k Euros of capital gains in Fairfax, with 30k Euros more received as dividends. I have made some money with GLRE. Most of all I have lost practically no money (with the only exception of LRE, which took me by surprise…).

 

My portfolio today:

33% Fairfax,

15% LMCA + LBRDA

15% BH (way undervalued imo!)

9% GLRE

28% very short term US treasuries

 

Gio

 

No TPRE?

[giofranchi]

No TPRE?

 

Not now. I sold out to raise capital for the BH rights offering and the LBRDA spin-off and rights offering. As right now I don’t want to decrease significantly the percentage of cash I hold.

 

I surely plan to buy it back later. ;)

 

Gio

 

[tede02]

Gio, how much time do you spend on investments vs. running your businesses let's say on a weekly basis? 

 

Also, how much time do you devote to an individual idea, on average, before making an investment?  This is something I always struggle with. 

 

Thanks,

 

Ted 

[giofranchi]

Gio, how much time do you spend on investments vs. running your businesses let's say on a weekly basis? 

 

Mmm… I have never really counted the hours I devote to supervising the team of people who help me running the businesses vs. the hours I spend thinking about my investments… But I guess it cannot be too far from the truth if I say 50-50… In the first half of my time I would also put the work I devote on taking strategic decisions for my businesses.

 

Also, how much time do you devote to an individual idea, on average, before making an investment?  This is something I always struggle with. 

 

It depends… the most of the buying I do is in companies I already own! So, very little time required there… I just look at the price! ;)

New investments are rarer, and therefore might take longer… But if I find what I like and look for, I initiate a relatively small position very soon, with the hope of getting the chance of averaging down in the future.

 

Gio

 

[investor-man]

Hey congrats! I'm hoping for similar results on the same timeline. Very inspirational!

[alertmeipp]

I started my company in 2004 with 25,000 Euros in equity. Until the end of 2010 operating earnings were much larger than investments. At the end of 2010 investments reached 1 million Euros for the first time, and truly started to matter. I have zero debt.

 

Yesterday the value of my firm’s investments exceeded 2 million Euros for the first time. Little more than a 20% cagr during the last 3 years and 10 months.

 

I am particularly satisfied by the way I have reached such a goal. Always behaving very conservatively and keeping as detached from stock market gyrations as possible. 30% of my capital has always remained invested in Fairfax, and another 20%-30% always in cash.

 

On the contrary, of course, if I had been more aggressive, by now I would probably be at 2.5 or 3 million Euros! ;)

 

Cheers,

 

Gio

 

 

What is the subject "doubled my capital for first time" mean? you went from 25,000 to 2millions, that's many times of doubling... what am I not understanding?

[ERICOPOLY]

I started my company in 2004 with 25,000 Euros in equity. Until the end of 2010 operating earnings were much larger than investments. At the end of 2010 investments reached 1 million Euros for the first time, and truly started to matter. I have zero debt.

 

Yesterday the value of my firm’s investments exceeded 2 million Euros for the first time. Little more than a 20% cagr during the last 3 years and 10 months.

 

I am particularly satisfied by the way I have reached such a goal. Always behaving very conservatively and keeping as detached from stock market gyrations as possible. 30% of my capital has always remained invested in Fairfax, and another 20%-30% always in cash.

 

On the contrary, of course, if I had been more aggressive, by now I would probably be at 2.5 or 3 million Euros! ;)

 

Cheers,

 

Gio

 

 

What is the subject "doubled my capital for first time" mean? you went from 25,000 to 2millions, that's many times of doubling... what am I not understanding?

 

I first thought he meant that yesterday he doubled his money in one day -- a first for him.  In that case he's got me beat because my record is two days.

[alertmeipp]

I started my company in 2004 with 25,000 Euros in equity. Until the end of 2010 operating earnings were much larger than investments. At the end of 2010 investments reached 1 million Euros for the first time, and truly started to matter. I have zero debt.

 

Yesterday the value of my firm’s investments exceeded 2 million Euros for the first time. Little more than a 20% cagr during the last 3 years and 10 months.

 

I am particularly satisfied by the way I have reached such a goal. Always behaving very conservatively and keeping as detached from stock market gyrations as possible. 30% of my capital has always remained invested in Fairfax, and another 20%-30% always in cash.

 

On the contrary, of course, if I had been more aggressive, by now I would probably be at 2.5 or 3 million Euros! ;)

 

Cheers,

 

Gio

 

 

What is the subject "doubled my capital for first time" mean? you went from 25,000 to 2millions, that's many times of doubling... what am I not understanding?

 

I first thought he meant that yesterday he doubled his money in one day -- a first for him.  In that case he's got me beat because my record is two days.

 

I have my personal double in days experience, but later I found, getting a double is no where as hard as keeping the doubled. You guys definitely passed the challenges.

[Guest longinvestor]

Congratulations to Gio!

 

The most significant part of this to me is that the entire capital base has doubled. And done through a concentrated portfolio and relative inactivity & minimal touching. And the candor of sharing actual amounts is commendable. In a world where obfuscation is common through percentages, minus-this, plus-that, ignore taxes, fees etc.  What was / is the total? Simple, no?

 

Powerful lessons shared by the masters and re-confirmed by Gio. Congratulations.

[crastogi]

Congrats! 

 

looks like in your country it is more efficient to keep capital in a operating business and invest than take it out as dividend an invest as an individual?

 

 

 

[giofranchi]

What is the subject "doubled my capital for first time" mean? you went from 25,000 to 2millions, that's many times of doubling... what am I not understanding?

 

Being this board essentially about stock market investments, I meant I have doubled my capital for the first time since the stock market investments of my firm truly started to matter.

How I went from 25k Euros to 1 million Euro is another story, one mostly of very good luck (and perhaps of a bit of hard work and dedication on my part too…).

 

Cheers,

 

Gio

 

[giofranchi]

Powerful lessons shared by the masters and re-confirmed by Gio. Congratulations.

 

Way too kind! Thank you very much! :)

 

Gio

[giofranchi]

looks like in your country it is more efficient to keep capital in a operating business and invest than take it out as dividend an invest as an individual?

 

Yes, definitely! ;)

 

Gio

[muscleman]

No TPRE?

 

Not now. I sold out to raise capital for the BH rights offering and the LBRDA spin-off and rights offering. As right now I don’t want to decrease significantly the percentage of cash I hold.

 

I surely plan to buy it back later. ;)

 

Gio

 

Thank you for bringing up BH to my attention, and big congrats for your business success!

[yadayada]

What is the subject "doubled my capital for first time" mean? you went from 25,000 to 2millions, that's many times of doubling... what am I not understanding?

 

Being this board essentially about stock market investments, I meant I have doubled my capital for the first time since the stock market investments of my firm truly started to matter.

How I went from 25k Euros to 1 million Euro is another story, one mostly of very good luck (and perhaps of a bit of hard work and dedication on my part too…).

 

Cheers,

 

Gio

Aaah quit that modesty crap man :d you kicked ass and made a cool million!

[CorpRaider]

Congrats!

[Cageyone]

Congratulations Gio!  Your story prompted me to go look back on the trends in my portfolio.  Unlike your “proactive” style, I’ve been a (lazy?) long-term buy and hold (rarely selling anything!) investor who has been tracking his investment portfolio on a weekly basis since the “crash” of 1987.  Just looking at my tax-sheltered account, it took 5 years until 1992 for the first double, but only 3 years until 1995 for the second double.  The third double took 7 years until 2002 and the fourth double took 5 years until 2007.  But in the 7 years since 2007 we’re only up 50%.  I guess my conclusions are: (a) compounding works, (b) good luck helps a lot, and © macro events are eventually mitigated over the long term!  It’s also helped a lot to have FFH gradually building up to over 40% of this portfolio.  (But I’ve also “gone to zero” on a number of names including Prem Watsa’s Can West Global and Conrad Black’s Hollinger!)

[giofranchi]

Just looking at my tax-sheltered account, it took 5 years until 1992 for the first double, but only 3 years until 1995 for the second double.  The third double took 7 years until 2002 and the fourth double took 5 years until 2007.  But in the 7 years since 2007 we’re only up 50%. 

 

Your track record is impressive! :)

 

Cheers,

 

Gio

[Guest longinvestor]

Congratulations Gio!  Your story prompted me to go look back on the trends in my portfolio.  Unlike your “proactive” style, I’ve been a (lazy?) long-term buy and hold (rarely selling anything!) investor who has been tracking his investment portfolio on a weekly basis since the “crash” of 1987.  Just looking at my tax-sheltered account, it took 5 years until 1992 for the first double, but only 3 years until 1995 for the second double.  The third double took 7 years until 2002 and the fourth double took 5 years until 2007.  But in the 7 years since 2007 we’re only up 50%.  I guess my conclusions are: (a) compounding works, (b) good luck helps a lot, and © macro events are eventually mitigated over the long term!  It’s also helped a lot to have FFH gradually building up to over 40% of this portfolio.  (But I’ve also “gone to zero” on a number of names including Prem Watsa’s Can West Global and Conrad Black’s Hollinger!)

 

Wow! 5 doubles in 25 is ~ 15% annualized. Congratulations on doing this, over the long term. Especially like the lazy approach myself. I see that you have posted only 18 times, keep them coming. After all, this board is overwhelmed with the busi-ness types, we could well use a balance of laziness. I know it is hard to pull yourself to post when you don't "do" much investing.

 

I started in earnest less than 10 years ago with the lazy approach. Approaching a triple from 2006. FFH was a large contributor to my results early on, I've since moved all of it to BRK. Looking forward to 2020 which will mark 10 years of this super concentration. I'm lucky that none of mine have gone to zero in the last 10.

 

Keep posting as you can, Cageyone.

[ageofsocrates]

Gio,

 

Would it be possible to know how you went from 25 k to 1 million? Sounds like an interesting story.

[Cageyone]

Hi longinvestor!

 

My biggest problem now is that I have to become "less lazy" and figure out what to sell!  I'm now into mandatory withdrawals from my sheltered account and in the next year I'm going to have to start raising some cash to keep the tax man happy.  (Ironically, my monthly mandatory withdrawals exceed my annual contributions before I retired a dozen years ago!)  So do I sell some solid stuff that is near it's all-time highs (such as Fairfax or Brookfield Asset Management), or to I reduce my stake in VRX which was on a tear but may collapse (if you believe the VRX bears) or do I sell stuff that I'm waiting to get back above water on (such as Blackberry, Sandridge Energy, Barrick etc. etc.) -- or do I do a bit of all of the above?