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Is it time to buy Fairfax?


Viking
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Is Fairfax a $20 bill laying on the street that everyone is walking by? Lots of former investors in Fairfax have such a long history with this company it is easy to let emotions cloud the decision making process. It is sometimes difficult to separate past experiences and what you do not like about a company from where it is today and more importantly where it is going tomorrow. The calculus shifted for me over the weekend. There are lots of great threads regarding Fairfax (thanks to Petec, Stubblejumper and others) to help get up to speed on the company.

 

Bought a big chunk of FFH today. The summary provided by Woodlock House pretty much sums up my thoughts on the company (i copied a chunk of it below). In addition, ex workers comp, we look to be in a hard market and Fairfax is growing its business nicely (it is after all an insurance company). Shares are trading today at US $420 P/BV ($465) = 0.9 look cheap to me.

 

- Positives: Shares are trading at a 5 year low (absolute price and P/BV, sentiment might be at all time low, we are in a hard market, bond portfolio is positioned very conservatively.

- The jury is still out: on equity investment decision process; saying better things, amd brought in some new blood but time will tell.

- Negative: i am not sure the company is run in the best interests of shareholders. That alone might make this purchase a trade for me.

- Impending: i am expecting news on taking out minority partners in the coming months (Brit and Eurolife). Down the road they need to do the same with Allied World.

- stock buybacks: one big catalyst for the shares would be if managment decided buying back stock trading at 0.9X BV was a top priority. Right now it is clear that they would rather use excess cash to grow the business and taking out their minority partners. My hope is they get creative here and find a way to do a meaningful buyback. 

 

From Woodlock House letter: http://www.cornerofberkshireandfairfax.ca/forum/fairfax-financial/woodlock-house-blog-post-about-ffh/

“Most of the investors I’ve talked to about FFH will bring up Watsa almost immediately as, basically, someone they no longer trust to make good decisions or deliver good returns. I can understand why. (The baffling macro bets of some years ago cost FFH shareholders billions of dollars. Watsa said he not would make such bets again. But the damage was done.)

 

The insurance side of the operation has been strong for FFH in recent years. But even there, operations are below Watsa’s target of a 95% combined ratio. FFH’s Q2 number was 96.8%. Profitable – anything below 100% is profitable – but below target.

 

So, as you can see, the valuation is not such a cut-and-dried matter. FFH has had some issues. Nonetheless, we own the stock at a price below book value.

 

The most important reason is that the downside seems low. The valuation protects you, the company appears well-financed and management seems honest and well-intentioned. These are not small things.

 

Moreover, I think the assets collectively could generate a ~10%-type ROE. Watsa has made a public goal of hitting 15%. (FFH’s ROE was 15% in the second quarter, thanks to investment gains). He says a 95% combined ratio and a 7% return on FFH’s investments gets to a 15% ROE.

 

But in a low-interest rate environment, and given a large bond portfolio, a 7% return seems unlikely. But possible. Sustaining a double-digit ROE is key. (FFH can reach 10% by following a number of roads. For example, one road requires a ~95% combined ratio and ~5% return on its portfolio. That seems do-able.)

 

Anyway, a consistent 10% would grow book value at a decent clip and then you’d likely get an additional lift from the valuation even if the stock moved just to 1.2x book. As RayJay reports, a comparable set of North American insurers with an 11% ROE trades for 1.7x book value per share.

 

I admit, FFH is not exciting. It’s not fake meat or pot or sending billionaires into space. But it shouldn’t hurt you and has potential to deliver a very nice return.”

 

https://www.woodlockhousefamilycapital.com/post/the-horse-story

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Every time it falls below book value, I see Brian Bradstreet buying some shares.  We shall know shortly! 

 

I think for long-term investors, who don't want to fiddle with their portfolio and just sleep at night...it's a buy!  Cheers!

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A couple of thoughts.

 

1) The 95% combined ratio target is almost certainly a long term/through the cycle target (like the ROE target). You therefore need to work out where we are in the cycle to know whether Fairfax is hitting its target or not.

 

2) You say management are honest but the company is not run in the interest of shareholders. Leaving aside whether either statement is true, could you explain why they don't contradict each other? I'm interested.

 

Thanks

 

Pete

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I bought it too. To me it is good for a 15%-20% puff and nothing more. Buy at close to 0.9x BV and sell out closer to 1.05x BV.

 

But I am under no illusion regarding a number of things

 

1. Its insurance business have gone from terrible to "do not suck" anymore. Does not mean they are good businesses.

 

2. A P&C company to me always comes with a ton of tail risks. I am not particularly imaginative but I can imagine enough scary scenarios that can impair value. FFH does not have a lot of offsetting exposures to positive tail events on its investment side like it did during 2008-2009 period.

 

3. Its investment portfolio is particularly exposed to economic tail risks.

 

4. Many think they have a great bond management team. Perhaps the best in the world. I disagree. No out-performance. Fooled by randomness at its best.

 

5. FFH investment team did not become dumb. They are smart. To take a fishing analogy (dangerous since I know nothing about fishing). Imagine there are several ponds and some ponds yield a lot of fish. Now imagine if some environmental factor depletes fish in some of the ponds. I think that is what happened to FFH. Replace pond with "value stocks" and environmental factor to "Internet". So investment returns are going to be tough going forward not only because of this but a number of other factors.

 

6. What happens if interest rates remain low or even turn slightly negative for an extended period of time? What returns would the investment portfolio generate in this case?

 

I did make an investment very recently. But if it goes up 20%, to me there is no MOS.

 

Vinod

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The idea that “value stocks” are underperforming is a myth.  If you buy five low quality, high debt companies that all fall apart on you, you didn’t buy “value.”  You were buying turn around specs that didn’t work out.  What is underperforming is low quality, capital intensity, over-leverage, etc.

 

I’m a fan of fairfax.  I root for them.  But their investment ills aren’t about value.  If anything their stocks are susceptible to a world of too much cheap capital, which feeds increasing competition, which erodes pricing power, which means moats collapse, etc.

 

Too many managers blame “value” being out of favor instead of realizing they mis-measured value.

 

For now, I wait for a meaningful discount to BV before I buy.

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A couple of thoughts.

 

1) The 95% combined ratio target is almost certainly a long term/through the cycle target (like the ROE target). You therefore need to work out where we are in the cycle to know whether Fairfax is hitting its target or not.

 

2) You say management are honest but the company is not run in the interest of shareholders. Leaving aside whether either statement is true, could you explain why they don't contradict each other? I'm interested.

 

Thanks

 

Pete

 

Pete, my guess is bond yields and combined ratio are connected. If bond yields in the US stay at current low levels or drop more then this will force all insurance companies to achieve a lower CR moving forward. Perhaps this is the key driver of the current hard market (not sure). This will take years to play out. So based on current yields and the outlook for the future i would expect FFH to get to a 95 or better CR in the coming years (similar to all companies they compete with).

 

I read both the Q1 and Q2 conference call transcripts and was happy with the presentations and the answers to questions (and minimal promotion). I do have a certain level of trust in management and that is why i bought shares.

 

I have found that over the years Fairfax has made decisions that appear to be focussed on making the company bigger (empire building) with the long term impact on shareholders a secondary concern. There has also been lots of discussion around corporate governance (family control and bringing the kids into the fold) that feed the ‘not shareholder friendly’ narrative. Is Prem’s number 1 focus to drive shareholder value? No, i don’t think so. Is it important to him? Yes.

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I bought it too. To me it is good for a 15%-20% puff and nothing more. Buy at close to 0.9x BV and sell out closer to 1.05x BV.

 

But I am under no illusion regarding a number of things

 

1. Its insurance business have gone from terrible to "do not suck" anymore. Does not mean they are good businesses.

 

2. A P&C company to me always comes with a ton of tail risks. I am not particularly imaginative but I can imagine enough scary scenarios that can impair value. FFH does not have a lot of offsetting exposures to positive tail events on its investment side like it did during 2008-2009 period.

 

3. Its investment portfolio is particularly exposed to economic tail risks.

 

4. Many think they have a great bond management team. Perhaps the best in the world. I disagree. No out-performance. Fooled by randomness at its best.

 

5. FFH investment team did not become dumb. They are smart. To take a fishing analogy (dangerous since I know nothing about fishing). Imagine there are several ponds and some ponds yield a lot of fish. Now imagine if some environmental factor depletes fish in some of the ponds. I think that is what happened to FFH. Replace pond with "value stocks" and environmental factor to "Internet". So investment returns are going to be tough going forward not only because of this but a number of other factors.

 

6. What happens if interest rates remain low or even turn slightly negative for an extended period of time? What returns would the investment portfolio generate in this case?

 

I did make an investment very recently. But if it goes up 20%, to me there is no MOS.

 

Vinod

 

Vinod, FFH for me is also a trade at this point in time.

 

1.) regarding insurance, Brit and Allied are the watchouts for me. Past experience shows it can be a bumpy ride for a few years post aquisition.

 

4.) my understanding is their long term bond results are among the best in the industry. Have they perfectly timed the changes in rates the past 2 years? No.

 

5.) FFH investment team is a big watch out. I do like the exposure to India and i do think this is a good fit. I have started reading up on Seaspan and the company is executing its plan well (and FFH has done well on its investment). Eurobank looks well positioned; if the Greek economy does ok this investment could perform very well. Blackberry trading at $6.50 does not look expensive to me and it is in the right spaces (QNX and cybersecurity). Many of the issues have already hit BV. Moving forward, yes, if the economy falls off a cliff their investments will take a hit. Or perhaps we bump along for a few years at 1.5% GDP growth... in this scenario their invesments should perform ok to very good.

 

6.) if bond yields stay low this will affect everyone in the industry. I think we can assume CR come down (perhaps this is what is driving the current hard market).

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Pete, my guess is bond yields and combined ratio are connected. If bond yields in the US stay at current low levels or drop more then this will force all insurance companies to achieve a lower CR moving forward. Perhaps this is the key driver of the current hard market (not sure). This will take years to play out. So based on current yields and the outlook for the future i would expect FFH to get to a 95 or better CR in the coming years (similar to all companies they compete with).

 

 

That's rational, but only if low ROEs cause capital to leave the industry. Unfortunately that hasn't been happening as far as I can tell. If anything low rates and innovative financial instruments have brought more capital into the industry, depressing CRs, such that bond yields and CRs may actually be positively correlated.

 

Regardless, my broader point is that if the through-the-cycle CR is 95% then at times it will be above and at times below, so you need to know where you are in the cycle to know whether they are on target. My guess is they are: they are not much above 95% after years of soft-ish markets. Suggests to me they will do better than 95% in a hard market.

 

I read both the Q1 and Q2 conference call transcripts and was happy with the presentations and the answers to questions (and minimal promotion). I do have a certain level of trust in management and that is why i bought shares.

 

I have found that over the years Fairfax has made decisions that appear to be focussed on making the company bigger (empire building) with the long term impact on shareholders a secondary concern. There has also been lots of discussion around corporate governance (family control and bringing the kids into the fold) that feed the ‘not shareholder friendly’ narrative. Is Prem’s number 1 focus to drive shareholder value? No, i don’t think so. Is it important to him? Yes.

 

Understood, thanks. I perhaps make less of a distinction between whether I trust management and whether they are shareholder friendly - I think it's largely the same thing - but I'm an active proponent of family control so I worry less about that part.

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Bought some more yesterday. Waiting for Q3 results which may include losses from Hurricane Dorian. Will double down if there is a significant drop.

 

^^^^^

This.

 

Not sure about the double down but the Dorian damage was massive in the Bahamas.  Not sure of the exposure there.  Maybe not statistically significant.  In the past, they have pre-announced significant hurricane losses but no announcement here.

On the plus side, SSW investment is looking up.  It is a bit depressing to see some of the 'value' industries they have been involved in over the years.  Many of these industries have been slowly killed and FFH has been in many.  Steel, Paper/forestry, Coal, Newspaper, choosing RIM/Blackberry instead of Apple, Retail Clothing, Retail - Toys (too early?).  It is hard to understand their investment decision-making process. 

It's almost as if they don't want to put any money into anything if it isn't $100M or more and they don't seem interested in businesses over $1-2B.

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It is a bit depressing to see some of the 'value' industries they have been involved in over the years.  Many of these industries have been slowly killed and FFH has been in many.  Steel, Paper/forestry, Coal, Newspaper, choosing RIM/Blackberry instead of Apple, Retail Clothing, Retail - Toys (too early?).  It is hard to understand their investment decision-making process. 

 

 

I just think they make life harder than it needs to be. When I think about the excitement on this board about BAC warrants a few years ago, which Fairfax didn't buy, despite the US clearly being prepared to debase its currency to avoid a depression and a general banking collapse - but then they were happy to buy a chunk of BKIR and Eurobank, in two economies that don't even control their currencies, as a result of whcih one of them slipped into a real depression...

 

Mind you there are others I see more sense in. Stelco has a huge amount of hidden value (read the last call). And I think they often go for things where some secondary asset backstops a lot of the value - eg land at Bangalore Airport, Stelco, Toys R Us.

 

As you say, SSW is working well (phew - one of my larger positions).

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  • 2 weeks later...

With all the chatter about their investments, it is easy to forget that Fairfax is at its core an insurance company. Q3 results had lots of good news. Performance of the insurance businesses was better than expected. It is also growing net written premiums better than expected and this growth is expected to continue into  2020. This is likely why we are seeing the share price of FFH up nicely post earnings.

 

Fairfax appears poised to deliver operating earnings (underwriting plus interest and div) of about US$30/share moving forward. Shares are trading at US$440.

 

Regarding the investment portfolio I think it is fair to say that Fairfax is a company in transition. Results for 7 years (2012-18) were terrible. The good news is management appears to have learned some important lessons. It is likely they will remain deep value investors (high risk/high reward type plays); not what Warren Buffett does but this is FFH and not BRK. As an investor it is easy to get anchored in the big mistakes made and it becomes very difficult to look at the current situation in an unbiased way.

 

I am slowly working my way through each of Fairfax’s largest equity positions. It has been a very good exercise as i am learning lots. Most importantly, it is helping me construct a more accurate picture of this part of Fairfax’s business (and improving my understanding of Fairfax as a whole). I am seeing much more that i like (especially given where the various businesses are priced today) than what i dislike. If the global economy continues to chug along at current growth rates and avoids a recession in the next couple of years then Fairfax could see some nice outperformance on the equity side of its business. The US jobs report on Friday was above consensus and the US consumer continues to spend which suggests the US economy is chugging along.

 

We likely also have a management team that is very unhappy with how low the shares are trading today. Management likely views this as an opportunity. In the past management has been very creative in coming up with solutions to problems. This is a potential catalyst for current shareholders that i think is under-appreciated. (I am not suggesting Fairfax does something to pump up their stock price; rather, they do something to take advantage of the gift Mr Market is giving them.)

 

When i find an investment that looks undervalued it is ideal if there exists a few catalysts that, if they happen, could help drive the share price higher.

 

Here are four potential catalysts for Fairfax:

1.) hard market will drive operating earnings higher into 2020 (this one is happening...)

2.) global economy continues to chug along, equity positions perform well

3.) management team gets creative and takes advantage of low share price. The asset dispositions may help in this regard; these could be listed as a separate catalyst (as proceeds may be beneficial but not be used to but back stock).

4.) improved investor sentiment. I think it is safe to say that sentiment in Fairfax today is at an all time low today and the shares are priced accordingly. As Fairfax executes it will begin the process of healing with the investor community.

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With all the chatter about their investments, it is easy to forget that Fairfax is at its core an insurance company. Q3 results had lots of good news. Performance of the insurance businesses was better than expected. It is also growing net written premiums better than expected and this growth is expected to continue into  2020. This is likely why we are seeing the share price of FFH up nicely post earnings.

 

Fairfax appears poised to deliver operating earnings (underwriting plus interest and div) of about US$30/share moving forward. Shares are trading at US$440.

 

Regarding the investment portfolio I think it is fair to say that Fairfax is a company in transition. Results for 7 years (2012-18) were terrible. The good news is management appears to have learned some important lessons. It is likely they will remain deep value investors (high risk/high reward type plays); not what Warren Buffett does but this is FFH and not BRK. As an investor it is easy to get anchored in the big mistakes made and it becomes very difficult to look at the current situation in an unbiased way.

 

I am slowly working my way through each of Fairfax’s largest equity positions. It has been a very good exercise as i am learning lots. Most importantly, it is helping me construct a more accurate picture of this part of Fairfax’s business (and improving my understanding of Fairfax as a whole). I am seeing much more that i like (especially given where the various businesses are priced today) than what i dislike. If the global economy continues to chug along at current growth rates and avoids a recession in the next couple of years then Fairfax could see some nice outperformance on the equity side of its business. The US jobs report on Friday was above consensus and the US consumer continues to spend which suggests the US economy is chugging along.

 

We likely also have a management team that is very unhappy with how low the shares are trading today. Management likely views this as an opportunity. In the past management has been very creative in coming up with solutions to problems. This is a potential catalyst for current shareholders that i think is under-appreciated. (I am not suggesting Fairfax does something to pump up their stock price; rather, they do something to take advantage of the gift Mr Market is giving them.)

 

When i find an investment that looks undervalued it is ideal if there exists a few catalysts that, if they happen, could help drive the share price higher.

 

Here are four potential catalysts for Fairfax:

1.) hard market will drive operating earnings higher into 2020 (this one is happening...)

2.) global economy continues to chug along, equity positions perform well

3.) management team gets creative and takes advantage of low share price. The asset dispositions may help in this regard; these could be listed as a separate catalyst (as proceeds may be beneficial but not be used to but back stock).

4.) improved investor sentiment. I think it is safe to say that sentiment in Fairfax today is at an all time low today and the shares are priced accordingly. As Fairfax executes it will begin the process of healing with the investor community.

 

+1 to all of this.

 

As you work through the equity holdings, would you post summary writeups on the Fairfax stock positions page? I for one would be interested, having done the same exercise a while ago.

 

 

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gary17, the stock was pretty hated going into earnings last week. It is up 10% in the past week (since they released results). Not sure what the driver is but we will see in the coming weeks if this move has legs; perhaps the technical picture is improving and this is helping. Fairfax stock does have a history of moving quickly when a new trend is established (up and down). Bottom line, with the stock trading at about BV it is still cheap.

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gary17, the stock was pretty hated going into earnings last week. It is up 10% in the past week (since they released results). Not sure what the driver is but we will see in the coming weeks if this move has legs; perhaps the technical picture is improving and this is helping. Fairfax stock does have a history of moving quickly when a new trend is established (up and down). Bottom line, with the stock trading at about BV it is still cheap.

 

10-year Treasuries are at 3-month highs. Fairfax trades where it did 3-months ago.

 

It's not a perfect correlation, but I continue to believe that we need to see sustained higher yields before Fairfax can consistently deliver an attractive ROE.

 

 

 

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gary17, the stock was pretty hated going into earnings last week. It is up 10% in the past week (since they released results). Not sure what the driver is but we will see in the coming weeks if this move has legs; perhaps the technical picture is improving and this is helping. Fairfax stock does have a history of moving quickly when a new trend is established (up and down). Bottom line, with the stock trading at about BV it is still cheap.

 

10-year Treasuries are at 3-month highs. Fairfax trades where it did 3-months ago.

 

It's not a perfect correlation, but I continue to believe that we need to see sustained higher yields before Fairfax can consistently deliver an attractive ROE.

 

Twocitiescapital, yes, higher bond yields would be immediately helpful to Fairfax. However, low bond yields are hitting all insurers hard and appear to be an important driver in what looks to be a hard market with pricing. Also, all insurers were being negatively impacted by bond yields falling this year and Fairfax was a massive relative underperformer (in terms of stock price). I think the key reason FFH spiked 10% in a week is sentiment changed; it was deeply oversold and its underlying business was actually chugging along. The rubber band is snapping back.

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I was reading Southeastern letter and their comment in Q3 dated Oct. 8:

 

"Fairfax Financial (-10%, -0.55%), the insurance and investment conglomerate, declined

despite solid underwriting results. The market focuses at times on Fairfax’s emerging

market exposure, which has been achieved very profitably and is a competitive

advantage going forward, but has been viewed this year as a negative when countries

like India struggle. In developed markets where Fairfax has more of its value, property

and casualty and reinsurance markets have been turning around with better pricing

after years of overcapitalization in the market. Fairfax remained disciplined and

avoided growing its policies unprofitably throughout the soft pricing market, and the

company is now intelligently increasing business across its subsidiaries, while

maintaining a strong combined ratio. The Fairfax balance sheet safely holds lowduration

debt and plenty of cash, allowing the company to be a liquidity provider when

superior equity investment opportunities arise."

 

Then they mentioned their activity:

"We also trimmed Fairfax early in the quarter and

trimmed Comcast and Alphabet as each appreciated in the quarter"

 

I believe they trimmed when price was above $650.

 

What's interesting to me is that it seems EM in general could be turning; India, with their tax cut, has been up in market activity and index, the sentiment could have changed. And if Southeastern is correct in the driving reason of FFH share price, we should see a rebound from here (actually underway?)

 

Any thoughts?

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Thrifty, there are three keys to Fairfax:

1.) underwriting

2.) bond holdings

3.) equity holdings

 

Their low stock price is not due to poor underwriting. Their bond portfolio is also very conservatively positioned (quality and short duration). It makes sense to me that the stock has massively underperformed (peers) due to Mr Market not liking Fairfax’s equity holdings (and past under-performance in this area). It currently has significant exposure to emerging markets (Thomas Cook India, CIB, Fairfax India and Africa etc).

 

If we see a return to risk-on in equity markets and emerging markets take off then this should help FFH stock. (This would also likely mean higher US bond yields which is also good for FFH). For those looking for exposure to ‘risk-on’ trade FFH might be a good fit; perhaps this is a factor driving the 10% jump in the past week.

 

https://www.marketwatch.com/story/why-a-noted-stock-market-bear-turned-upbeat-on-cyclicals-2019-11-08?siteid=yhoof2&yptr=yahoo

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Thank you Viking. Makes a lot of sense to me.

 

In your 3 points above, we have an insurance company, a short duration long bond fund, plus an EM private equity fund(?) in one company?

 

I'm surprised that they don't have exposure to the toxic sh&t in energy such as NatGas or offshore. It seems that they are really good at getting themselves into something that's just about to go into deep depression.

 

One way to trade is to watch what FFX buys and wait for a year or two (or 10) to follow in. You either get it cheaper before it goes belly up or get a 3 to 10 bagger.

 

Are you doing that these days?

 

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Thirfty, i used to closely follow what Fairfax was doing from an invesmtent standpoint (i also used to follow Francis Chou) and sometimes made purchases. I generally stopped about 4 or 5 years ago. Today i prefer large cap; quality; out of favour. Fairfax’s style is generally not a good fit for me these days (deep value... declining industries... sometimes declining companies). I am following their investments today more to understand how it is impacting Fairfax book value than to invest directly. Having said that Fairfax India does look interesting at $11.50...

 

Sharper, i agree, the upcoming $10 US dividend is another (small) near term benefit for current owners :-)

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There's nothing wrong with just keeping it very simple, and simply buying/selling across the ex-dividend date.

Buy a day before the ex-date, take the USD 10 dividend, sit in the thing for a short period until the price recovers, and exit.

Done and dusted by the end of January.

 

SD

I have done this in the past, in a significant way, by initiating or increasing the position, on three or four occasions. Part of the motivation was because FFH was felt to be an anchor holding that could be held for the long term and part of the motivation was because I thought it was possible to take advantage of the temporary mismatch. I now come to the conclusion that I was wrong with the short term predictive power (process) even if the outcome has always been positive. Maybe others can do this effectively but I come to the conclusion that FFH price had a tendency to go up and luck explains the result. Your post though brought back a nice souvenir when I was planning to do this in November 2012 and, in fact, materially increased my position a certain day which was related to technical selling or something. Then again, if I were a brighter trader, I would have kept the trading chunk for longer as the realized gain on the incremental investment was about 20% vs 100% if I had waited another 2 years or so. Interestingly, I found that this was discussed in 2012.

https://www.cornerofberkshireandfairfax.ca/forum/fairfax-financial/fairfax-down-8-this-morning/60/

Edit:

Here's the link to the first page of the thread:

https://www.cornerofberkshireandfairfax.ca/forum/fairfax-financial/fairfax-down-8-this-morning/

I see that Viking indicated that he was back in the saddle again and felt that things looked good for the next year or two. Nice call!

As Yogi Berra said (versus decision making): When you come to a fork in the road, take it!

 

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Other than a periodic annual 'visit' we aren't in FFH anymore.

Long time ago, I did a series of rolling 10-yr tests assuming a purchase the day before ex-date; and a resale at 2 weeks, 1, 2 months later - or 2 weeks after the Q4, Q1 earnings releases. Versus a simple full-yr calendar hold.

 

Ultimately the conclusion was that you had to be very specific on what you were trying to capture, and adjust your holding period accordingly. IE: Were you trying to capture dividend effect?, yr-end reporting effect? seasonality effect?, hurricane effect? and was FFH one of the better vehicles by which to do that?

 

SD

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