500 Pages

[sshr]

Buffett reads 500+ pages daily. Ted and Todd do the same. From what I gather, they read:

1) 4+ daily newspapers

2) annual reports/10Ks/10Qs

3) trade magazines

 

No question on 1) and 2).
 

What trade magazines do you read? How do you get access to them cheaply (or freely)?

[Sweet]

I don’t think it’s possible to read 500 pages a day consistently.

 

If you read a page a minute would take you 8+ hours to read 500 pages.

 

Possible to do that every now and again but consistently, no way.

[gfp]

8 hours ago, sshr said:

What trade magazines do you read? How do you get access to them cheaply (or freely)?

 

For Insurance, I subscribed to these years ago and while I don't pay anything anymore or have access to all of the articles, they still continue to send me quite a bit of content for free.  If something seems particularly interesting and is behind a paywall I can usually read about it through a company press release or another media source describing the same event.

https://www.insuranceinsider.com

https://www.theinsurer.com

https://www.es-insurer.com/

 

I think Ted Weschler and Warren both read furniture industry publications.  I do not, but those guys have businesses in this field.

https://www.homefurnishingshalloffame.com/trade-publications

 

Warren has mentioned being a long time reader of Banking industry trade publications like this one:

https://www.americanbanker.com/magazine

and their general website https://www.americanbanker.com/

 

There are many Oil and Gas industry publications.  I don't know which ones Warren and/or Greg Abel read, but I wouldn't be surprised if they read some on this list. 

https://blog.feedspot.com/oil_and_gas_magazines/

 

As an individual investor I don't think it is going to be super helpful to try to force a bunch of super specific industry chatter into your head just because the guys at Berkshire do it.  They have businesses in these fields and have read these publications for decades, so a quick skim when something comes in the mail is enough.

There is also a lot of value in having a network of friends and colleagues that send you articles they think you will find value in.  It used to be clippings in the mail, today it is probably web links or PDFs most of the time.  If Greg Abel or Bill Gates or Charlie sends Warren an article I'm sure he will at least skim it.

[ValueArb]

1 hour ago, Sweet said:

I don’t think it’s possible to read 500 pages a day consistently.

 

If you read a page a minute would take you 8+ hours to read 500 pages.

 

Possible to do that every now and again but consistently, no way.

 

I think there is a lot of skimming in that 500 pages.

[Sweet]

42 minutes ago, ValueArb said:

 

I think there is a lot of skimming in that 500 pages.

 

I can read 500 pages if I skim most of it too lol.  That’s how I prefer to read actually ha

[Gregmal]

Reading isn’t like doing push-ups. It’s not all the same in terms of the benefit. So I think this sort of thing is ripe to be wildly misinterpreted. If I find great content, or a book like Reminisces of a Stock Operator, I can read for days or weeks, with undivided attention. Try too hard to find content, and you’ll find yourself on Twitter dumbing yourself down and wasting time better spent mowing the lawn.

[Saluki]

1 hour ago, gfp said:

 

 

As an individual investor I don't think it is going to be super helpful to try to force a bunch of super specific industry chatter into your head just because the guys at Berkshire do it.  They have businesses in these fields and have read these publications for decades, so a quick skim when something comes in the mail is enough.

There is also a lot of value in having a network of friends and colleagues that send you articles they think you will find value in.  It used to be clippings in the mail, today it is probably web links or PDFs most of the time.  If Greg Abel or Bill Gates or Charlie sends Warren an article I'm sure he will at least skim it.

 

There is no trade press that I consistently read anymore.  When I was in private practice I used to read Cablefax Daily (which in 2000 used to literally be faxed to our law firm) and a Natural Gas publication whose name I forget because it was relevant to work and it was a half an hour a day that I can bill to the firm (only 7.5 more billables to go for the day!).  When I have a position in something (or am researching) they can be very helpful and very specialized.  During one of the bird flu scares I invested and did well with Pilgrims Pride and Sanderson Farms, but only after reading several issues of Poultry Times (yes, that's a real magazine) that had discussions about bird flu, bio security and stuff like that.   I think as a part time investor with a day job it would be hard to do anything close to Buffett's level of reading, so if you are looking at a stock or industry it might be better to read stuff "just in time" rather than "just in case". 

 

 

[ICUMD]

Unfortunately, of the things I read, less than 1% is useful knowledge.   Of that, the actionable 1% requires many more hours of contemplation.

[JAK]

I would add that it is almost as important to think about, and remember what you read, as it is to read. 

 

So quantity while impressive, is a bit of a waste if you don't retain it. Maybe its age, but I find there's lots of things that strike you as interesting, and you think you will later remember so you don't note them down, but you don't actually remember... 

During Covid, I read 52 books in one year (fiction and non-fiction). The next year, I settled for 26. Lots were audiobooks, so I guess 2X speed and doing housework didn't help. However, going through my list on Goodreads, there are some, where if you offered me $1 million to write a 1 pager on them, I would probably struggle to get out more than a few lines...

So I would definitely recommend active notetaking, I use Notion as its on phone and pc, so accessible and with me all the time, and searchable (as opposed to scribbles in the margin of hardback). However, it does slow down the reading process a lot... hard to take notes on audible, while also doing the dishes.. On the upside, you can reread your personalised notes (more meaningful to you than sparknotes), instead of rereading an entire book if you need a refresher.

 

 

[Parsad]

8 hours ago, Sweet said:

 

I can read 500 pages if I skim most of it too lol.  That’s how I prefer to read actually ha

 

The skill is to be able to skim those 500 pages and pull out the nuggets that have any pertinence.  I'm sure that's what they do...not read every single story on every page. 

After all these years, they know what things they need to read and what things are irrelevant. 

 

I must read at least a couple hundred pages a day at least...skimming out the irrelevant stuff is part of the process.  Also it's habit and part of my daily routine like eating, going to the bathroom, sleeping.  I have to read every day and I probably spend several hours doing it...including while eating and going to the bathroom! 

  

Cheers!

[texual]

They are also lucky to have largely avoided bloated corporate structure and hierarchy. they have a minimal office staff. likely few to no meetings on a day to day basis. they make investment decisions only when they want to. doubtful they're having to field shareholder phone calls. deals come by every so often. so these guys are literally able to read all day everyday and what a blessing. that and taking naps. i'd be inclined to say this form of a job is both unique and not easy to come by. working from home and being a freelancer etc or even running your own business rarely leads to such an astonishing amount of free time day to day where reading and learning at will are the primary job.

 

i'm thinking this is what i'd do in retirement. right now i've crafted a schedule with a daytime goal of reading 100 pages in downtime which works out to 500 pages a week. i can't imagine having the stomach to read more than 100 pages but maybe it takes a special person - and these are very special people indeed. 

[sshr]

All good suggestions. Thank you. So, here is a hypothetical. 

 

Over the years you have read investor letters/books/articles by/of Buffett, Graham, Fisher, Lynch, Greenblatt, Klarman, Einhorn, Ackman, Loeb, Pabrai, Druckenmiller, etc etc. You have bought into value investing philosophy (50 cents on a dollar, buy businesses with moat, pay less than intrinsic value, margin of safety, yada yada yada). Overtime you have developed your own investment style. You have curated a list of few hundred businesses from Valueline. Common theme is 1) business has been around for a while (at least 10 years of financials), 2) business generates profit and positive operating cash flow, 3) median ROIC of 15% or more over 10 years, 4) business has a potential to be in existence 5-10 years from now. You have now invested in 70 or so of these businesses over the past 7-8 years.

 

You have decent understanding of DCF and other valuation methodologies. But, who has time to run a DCF on all the companies you are interested in. Further, you have no confidence or conviction in your valuation. So, you put new money to use only when there is a drawdown (earning miss, analyst downgrade, 52 week low, etc). You seldom sell. Your result has been satisfactory. Let's say IRR of 15%. I use IRR because new money has been added over the years.

 
You have done your time - worked long hours/late nights/weekends pushing paper in financial services industry. You have no more desire to manage direct reports, do not want your boss' job and do not want to commute an hour and half each way to lower Manhattan.

 

Now, let's say you are now in a fortunate position to fire your employer. Your wife has a job that she loves and has positive impact to the society. Your kids enjoy having you around whenever they need you (pickup/drop off from school, ride to sports and after school activities, homework help, call from school to fetch musical instrument or Math workbook because they forgot, etc). Your family members/friends have also entrusted you with their capital and you have invested their capital in some (not all) of the same 70 companies. They are low maintenance, require very infrequent updates and are happy with their investment returns. You do not collect any fees nor do you intend to.  

 

The question now is how do you fill your time from 8:30am to until kids come home from school? Let's say you already do these things and enjoying doing them: 1) read FT/WSJ/NYT 2) listen to earning calls (or read transcripts) 3) read investor presentations 4) skim through 10Qs and 10Ks. 

 

What else does a full time investor do if he/she does not have an administrative burden of running a fund? Don't say do more of the above because you only have a mental bandwidth to do one or two of each per day. The goal here is to fill the day with meaningful work (business/investment related) so you avoid unforced errors like 1) engaging in dubious merger arbitrages 2) shorting Tesla or indexes because you have a view that they are overvalued or 3) investing in companies you know nothing about (and are outside of the list mentioned above) because call for action is really loud in the COBF community.  
 

[ValueArb]

2 hours ago, sshr said:

All good suggestions. Thank you. So, here is a hypothetical. 

 

Over the years you have read investor letters/books/articles by/of Buffett, Graham, Fisher, Lynch, Greenblatt, Klarman, Einhorn, Ackman, Loeb, Pabrai, Druckenmiller, etc etc. You have bought into value investing philosophy (50 cents on a dollar, buy businesses with moat, pay less than intrinsic value, margin of safety, yada yada yada). Overtime you have developed your own investment style. You have curated a list of few hundred businesses from Valueline. Common theme is 1) business has been around for a while (at least 10 years of financials), 2) business generates profit and positive operating cash flow, 3) median ROIC of 15% or more over 10 years, 4) business has a potential to be in existence 5-10 years from now. You have now invested in 70 or so of these businesses over the past 7-8 years.

 

You have decent understanding of DCF and other valuation methodologies. But, who has time to run a DCF on all the companies you are interested in. Further, you have no confidence or conviction in your valuation. So, you put new money to use only when there is a drawdown (earning miss, analyst downgrade, 52 week low, etc). You seldom sell. Your result has been satisfactory. Let's say IRR of 15%. I use IRR because new money has been added over the years.

 
You have done your time - worked long hours/late nights/weekends pushing paper in financial services industry. You have no more desire to manage direct reports, do not want your boss' job and do not want to commute an hour and half each way to lower Manhattan.

 

Now, let's say you are now in a fortunate position to fire your employer. Your wife has a job that she loves and has positive impact to the society. Your kids enjoy having you around whenever they need you (pickup/drop off from school, ride to sports and after school activities, homework help, call from school to fetch musical instrument or Math workbook because they forgot, etc). Your family members/friends have also entrusted you with their capital and you have invested their capital in some (not all) of the same 70 companies. They are low maintenance, require very infrequent updates and are happy with their investment returns. You do not collect any fees nor do you intend to.  

 

The question now is how do you fill your time from 8:30am to until kids come home from school? Let's say you already do these things and enjoying doing them: 1) read FT/WSJ/NYT 2) listen to earning calls (or read transcripts) 3) read investor presentations 4) skim through 10Qs and 10Ks. 

 

What else does a full time investor do if he/she does not have an administrative burden of running a fund? Don't say do more of the above because you only have a mental bandwidth to do one or two of each per day. The goal here is to fill the day with meaningful work (business/investment related) so you avoid unforced errors like 1) engaging in dubious merger arbitrages 2) shorting Tesla or indexes because you have a view that they are overvalued or 3) investing in companies you know nothing about (and are outside of the list mentioned above) because call for action is really loud in the COBF community.  
 

 

I fell into a habit of playing poker in the afternoons. I made a lot of money playing poker and it cost me far more money in my investments.

Edited February 8, 2023 by ValueArb

[Parsad]

2 hours ago, sshr said:

All good suggestions. Thank you. So, here is a hypothetical. 

 

Over the years you have read investor letters/books/articles by/of Buffett, Graham, Fisher, Lynch, Greenblatt, Klarman, Einhorn, Ackman, Loeb, Pabrai, Druckenmiller, etc etc. You have bought into value investing philosophy (50 cents on a dollar, buy businesses with moat, pay less than intrinsic value, margin of safety, yada yada yada). Overtime you have developed your own investment style. You have curated a list of few hundred businesses from Valueline. Common theme is 1) business has been around for a while (at least 10 years of financials), 2) business generates profit and positive operating cash flow, 3) median ROIC of 15% or more over 10 years, 4) business has a potential to be in existence 5-10 years from now. You have now invested in 70 or so of these businesses over the past 7-8 years.

 

You have decent understanding of DCF and other valuation methodologies. But, who has time to run a DCF on all the companies you are interested in. Further, you have no confidence or conviction in your valuation. So, you put new money to use only when there is a drawdown (earning miss, analyst downgrade, 52 week low, etc). You seldom sell. Your result has been satisfactory. Let's say IRR of 15%. I use IRR because new money has been added over the years.

 
You have done your time - worked long hours/late nights/weekends pushing paper in financial services industry. You have no more desire to manage direct reports, do not want your boss' job and do not want to commute an hour and half each way to lower Manhattan.

 

Now, let's say you are now in a fortunate position to fire your employer. Your wife has a job that she loves and has positive impact to the society. Your kids enjoy having you around whenever they need you (pickup/drop off from school, ride to sports and after school activities, homework help, call from school to fetch musical instrument or Math workbook because they forgot, etc). Your family members/friends have also entrusted you with their capital and you have invested their capital in some (not all) of the same 70 companies. They are low maintenance, require very infrequent updates and are happy with their investment returns. You do not collect any fees nor do you intend to.  

 

The question now is how do you fill your time from 8:30am to until kids come home from school? Let's say you already do these things and enjoying doing them: 1) read FT/WSJ/NYT 2) listen to earning calls (or read transcripts) 3) read investor presentations 4) skim through 10Qs and 10Ks. 

 

What else does a full time investor do if he/she does not have an administrative burden of running a fund? Don't say do more of the above because you only have a mental bandwidth to do one or two of each per day. The goal here is to fill the day with meaningful work (business/investment related) so you avoid unforced errors like 1) engaging in dubious merger arbitrages 2) shorting Tesla or indexes because you have a view that they are overvalued or 3) investing in companies you know nothing about (and are outside of the list mentioned above) because call for action is really loud in the COBF community.  
 

 

Well at this point, you are essentially semi-retired.  You have to do what retirees do...find other outlets to spend your time which used to be consumed by work and other obligations.  For me...the #1 goal is travel.  I would be very happy to go live in different parts of Europe each year for a few months and do nothing but drink coffee, visit museums and wake up knowing I have nothing to do...except drink coffee and visit museums!  

 

In the mean time until I reach that point, any extra time is spent on watching sports, playing with my niece and nephew, occasional golf outing, and sitting at a cafe drinking coffee in Vancouver.  But the 5-7 hours a day reading...it still gets done every day, no matter what!  Even if I'm feeling like shit...the reading to some extent will get done.  Cheers!

[DooDiligence]

On 2/7/2023 at 10:53 AM, JAK said:

I would add that it is almost as important to think about, and remember what you read, as it is to read. 

 

So quantity while impressive, is a bit of a waste if you don't retain it. Maybe its age, but I find there's lots of things that strike you as interesting, and you think you will later remember so you don't note them down, but you don't actually remember... 

So I would definitely recommend active notetaking, I use Notion as its on phone and pc, so accessible and with me all the time, and searchable (as opposed to scribbles in the margin of hardback). However, it does slow down the reading process a lot... hard to take notes on audible, while also doing the dishes.. On the upside, you can reread your personalised notes (more meaningful to you than sparknotes), instead of rereading an entire book if you need a refresher.

 

This is the way. It's never been easier to do. I use Apple Notes for classwork, investments, home (I documented my entire sprinkler system in Notes, with photos), coins, music, tech guides and more. Making your own quick references teaches you how to do stuff.