Buffett on David Winters.

[Picasso]

Man that performance is awful....

 

You know the wheels are coming off the bus when you have to start quoting Dr. Seuss in your investor letters. 

[beerbaron]

Don't f*** with Buffett. He's a nice grandpa but he's not dumb.

 

BeerBaron

[jawn619]

Man that performance is awful....

 

You know the wheels are coming off the bus when you have to start quoting Dr. Seuss in your investor letters.

 

I LOL

[wescobrk]

Not exactly the sharpest tool in the shed to take on Buffett of all people.

What the hell was he thinking?

[adesigar]

Im not defending the calculation mistakes David Winters made but shouldn't this have been picked up by Buffett? Why did it come to his attention after David Winters pointed it out? And what does it say about Berkshire Hathaway's future chairman who is on the KO board? Is the board seat more important than the duty to the shareholders? Frankly I didn't care too much for his explanations at the annual meeting about abstaining, how boards work and why even though Howard Buffett voted for the compensation plan he is still the best choice for BRK Chairman.

 

edit.

PS: Let the flaming begin on how im clueless.

[Mephistopheles]

He said he noticed the pay plan before Winters brought it up.

 

I get his logic behind abstaining. He knows he's influential enough that he doesn't need to vote no in order for the plan not to work. Instead he took the diplomatic approach which also preserved Berkshire's relationship with Coke. It was brilliant imo.

 

As far as Howard Buffett. I agree it was a weak explanation by Warren, blaming how boards work. Howard should have been more active on the issue and Warren shouldn't have made a silly excuse.

 

Overall Warren threw his weight around and it worked, so I'm glad.

[ccplz]

Warren is a top class hypocrite.

 

[ScottHall]

Warren is a top class hypocrite.

 

What brought this on?

 

By the way, the problem with Warren Buffett isn't that he has flaws. So do you, so do I, so does everyone on this board and in the larger world. The problem is that value investors deify him.

 

I know value investing has its own Holy Trinity with Graham, Buffett and Munger, but it's important to recognize that although you can learn a lot from these people, their investment philosophies are not authoritatively right. Meaning, just because they invest a certain way doesn't mean you have to, and it doesn't mean there aren't better ways.

 

One of the best investors I know is a high growth investor, who buys all the stocks everyone on this forum hates and has for several decades. His returns are quite good, and they'd be out of this world if he could figure out how to filter out failed growth investments (80%+ losers) from his picks. I've been working at incorporating his insights into my own investing style, which has gone from deep value to a growth/value hybrid over the years. So far it's worked out well but it's still very early days. I have 40+ years to go.

 

The key point is that Buffett's style is Buffett's. Graham's style was Graham's, Munger's is Munger's. There are things you can take from each of these people without deifying and/or demonizing them, but their philosophies aren't something you should copy and paste over your own. They're men and men are fallible; humans are without exception all weak in certain ways.

 

I've gotten much more use from these men by looking at the frameworks they've provided than from their actual investing philosophies and quirks. Ben Graham was great for being a pioneer in the valuation of securities, rather than his specific techniques for valuing them. Buffett is great because he crystallized concepts of unique forms of leverage that can give insight into which sort of companies can earn returns supercharged by financial steroids. Munger is great because of his use and study of mental models, which allow you to use the teachings of all three men (and many others) and apply them in ways that they weren't necessarily originally intended, at least when viewing their writings narrowly.

 

All three are legendary in the field, and for good reason. But all of their work can be improved upon; Graham was essentially a visionary who challenged the investing conventions of the time and gave the world a baseline for valuation that was pretty much unheard of at the time. Yet today, many of his more fervent supporters are zealous about his theories and are unwilling to accept that there may be better ways to go about investment. Not that all do, but it's a pretty sizable bloc. It's sort of ironic; a visionary who challenged convention ended up breeding a cult that refuses to accept any other standard than the convention he established.

 

It's sort of interesting to me. Followers of the man who brought the concept of float to light have largely missed Amazon, one of the greatest beneficiaries of float in the modern era. So many love the concepts, and understand them. But they are not comfortable with the application beyond the basics that Buffett handed them. The opportunity cost on that is huge; you just have to get a little creative with your thinking.

 

That's how I view the whole church of value, anyway. So many great ideas and concepts that are misapplied, underapplied, or applied so devoutly that the good concepts of other investing philosophies are shut out.

 

The fathers of value investing are great men, and these is much we can learn from them. But they are not gods, and they should not be held to such a high standard either personally or professionally. It is not fair to them, and it is not fair to us.

 

 

[augustabound]

 

By the way, the problem with Warren Buffett isn't that he has flaws........ The problem is that value investors deify him.

 

Exactly right.

 

Great point about the float of insurance companies and Amazon.

It's funny, every now and then I go back through my old notes. At one point I had an almost obsession with learning the insurance industry.

 

I believed that all successful investors find the diamond in the rough that have almost endless float combined with a fantastic investor behind that float.

Notes on old watchlist companies (back when I had a watchlist), JNJ KO PG WFC.............

 

Then a bit of my own reflection and some help from bloggers like Geoff Gannon and Nate helped me realize this way of Buffett following wasn't for me (It's really not for most people, those same people who should heed WEB advice and put their money in an index ETF). The key point that made me refocus my thinking was a post of Geoff's about his investing philosophy. He chooses the small, obscure stocks  in industries he knows because he said he's not smart enough to know a great business like the ones Buffett talks about. And in his opinion (and mine too), most people aren't smart enough.

 

Nate posted about loving the small annual reports from small and microcap stocks. At that point I realized I had a really hard time with long annual reports and the short ones were like heaven to read. That combined with few moving parts of a small cap.

Small individual investors with a career and family couldn't possibly know all the moving parts of GE or JNJ and if they could it would take far too long to understand. <insert Buffett or Munger quote on opportunity cost here>

 

Take Buffett's advice and apply it to your own framework. Like Munger's mental models. Don't make his framework yours because it won't work the same way.

 

Deify is right. I always find it funny how upset people get if you say anything negative about Buffett.

[ScottHall]

Further thoughts on this that I wrote with a coworker:

 

http://www.fool.com/investing/general/2016/01/19/warren-buffett-and-the-cult-of-value-investing.aspx

[Jurgis]

Further thoughts on this that I wrote with a coworker:

 

http://www.fool.com/investing/general/2016/01/19/warren-buffett-and-the-cult-of-value-investing.aspx

 

The article is mostly OK, but it's still MF click bait.

[ScottHall]

Further thoughts on this that I wrote with a coworker:

 

http://www.fool.com/investing/general/2016/01/19/warren-buffett-and-the-cult-of-value-investing.aspx

 

The article is mostly OK, but it's still MF click bait.

 

Thanks for your honesty.

[Jurgis]

Further thoughts on this that I wrote with a coworker:

 

http://www.fool.com/investing/general/2016/01/19/warren-buffett-and-the-cult-of-value-investing.aspx

 

The article is mostly OK, but it's still MF click bait.

 

Thanks for your honesty.

 

I understand you guys have to do this. Doesn't mean I like it. ;)

 

Take care.

[ScottHall]

Further thoughts on this that I wrote with a coworker:

 

http://www.fool.com/investing/general/2016/01/19/warren-buffett-and-the-cult-of-value-investing.aspx

 

The article is mostly OK, but it's still MF click bait.

 

Thanks for your honesty.

 

I understand you guys have to do this. Doesn't mean I like it. ;)

 

Take care.

 

I really can't comment on TMF's business practices, sorry. I would like to note, though, that we wrote this for fun and neither of us was compensated for it to my knowledge, and it was something we did independently (not part of our day to day jobs) as we both work in marketing.

 

Again, can't speak to TMF's broader business practices, but I understand your frustration. And no worries, I'm not offended in the slightest. :)

 

Best wishes,

 

Scott

[VersaillesinNY]

AUM continues to sink at Wintergreen fund:

 

http://www.wintergreenfund.com/downloads/wintergreen_fund_annual_report_20151231.pdf

 

As we look back on Wintergreen Fund, Inc.'s (the "Fund"or "Wintergreen") first ten years, we are extremely pleased with what we have accomplished.

wintergreen_fund_annual_report_20151231.pdf

[AzCactus]

AUM continues to sink at Wintergreen fund:

 

http://www.wintergreenfund.com/downloads/wintergreen_fund_annual_report_20151231.pdf

 

As we look back on Wintergreen Fund, Inc.'s (the "Fund"or "Wintergreen") first ten years, we are extremely pleased with what we have accomplished.

 

The above reminds me of Richard Feyman's quote about fooling yourself and remembering that you are the easiest person to fool.

 

[coc]

AUM continues to sink at Wintergreen fund:

 

http://www.wintergreenfund.com/downloads/wintergreen_fund_annual_report_20151231.pdf

 

As we look back on Wintergreen Fund, Inc.'s (the "Fund"or "Wintergreen") first ten years, we are extremely pleased with what we have accomplished.

 

The above reminds me of Richard Feyman's quote about fooling yourself and remembering that you are the easiest person to fool.

 

 

I don't think it's himself he's trying to fool...just my opinion.

[Kuhndan]

Poor results. I wouldn't be pleased if he was managing my money.

[VersaillesinNY]

Getting some distraction by reading David Winter's semi-annual.

 

http://www.wintergreenfund.com/reports/sar/

 

AUM continue to sink by (15%) in just 6 months and the fund is getting toasted on its 10 years anniversary; there is nothing to celebrate for his shareholders.

The fund has 34% of its assets invested in tobacco and cigarettes... and tobacco companies kill their best customers.

I understand that David Winters doesn't advocate smoking but he might advocate drinking in order to forget about these results.

 

Gudang Garam International InterSport World Cup 2010 Commercial Ads - "It's not about winning or losing"

https://youtu.be/QlqHxSkYBPg?t=24s

 

Buffett might be observing the results through the telescope.

 

Let me tell you the secret that has led me to my goal. My strength lies solely in my tenacity.

Louis Pasteur

wintergreen_fund_semi_annual_report_20160630.pdf

[bargainman]

Wow that's one impressive letter… it's not enough that he took on Warren Buffett for not being shareholder friendly, now he's taking on ETFs and low-cost index funds for being very expensive! Careful with those look through expenses he says!  All the while he sits back underperforming and collecting is 2% fee on a shrinking asset-based…

[scorpioncapital]

Think of the psychology. By planting the seed that passive management is bogus, you can claim that MY active management is the answer. Salesmanship in all its modern day glory.

 

 

 

 

 

[VersaillesinNY]

AUM continue to sink by (20%) in just 6 months. The fund underperformed the index in 2016. The portfolio smells Tobacco (36.7% exposure).

 

http://www.wintergreenfund.com/reports/ar/

 

We keep moving forward, opening up new doors and doing new things... and curiosity keeps landing us down new paths.

Walt Disney

wintergreen_fund_annual_report_20161231.pdf

[physdude]

AUM continue to sink by (20%) in just 6 months. The fund underperformed the index in 2016. The portfolio smells Tobacco (36.7% exposure).

 

http://www.wintergreenfund.com/reports/ar/

 

We keep moving forward, opening up new doors and doing new things... and curiosity keeps landing us down new paths.

Walt Disney

 

Interestingly, the fund also lists 100 Berkshire class B shares among its holdings. Seriously, why bother holding such a miniscule position?

[InelegantInvestor]

AUM continue to sink by (20%) in just 6 months. The fund underperformed the index in 2016. The portfolio smells Tobacco (36.7% exposure).

 

http://www.wintergreenfund.com/reports/ar/

 

We keep moving forward, opening up new doors and doing new things... and curiosity keeps landing us down new paths.

Walt Disney

Is there a period of time for which the fund did not underperform the index?

Also, interesting that he does not mention Consolidated Tomoka, one of his largest holdings, and where he is amidst a long fight with management(that he put in place).

[CorpRaider]

I will say that at least he didn't change his bogey index to the total market or total developed market.  He probably would be more justified than some since it looks like he's 50% ex us.