Fairfax 2024

[MMM20]

17 hours ago, SafetyinNumbers said:

Thanks! Many thanks to @NormR for helping so much with the editing and connecting me with his editor.
 

I’m so excited to see it in the paper when it gets delivered tomorrow. Long time subscriber, first time contributor

Any chance you can post a PDF?

[gfp]

pdf of the article.  Go ahead and remove it if an opinion section excerpt is some kind of copyright issue.

Why Fairfax Financial.pdf

[MMM20]

29 minutes ago, gfp said:

pdf of the article.  Go ahead and remove it if an opinion section excerpt is some kind of copyright issue.

Why Fairfax Financial.pdf 35.13 kB · 17 downloads

Great work @SafetyinNumbers and thanks for sharing @gfp. We like the stock

[dartmonkey]

18 hours ago, SafetyinNumbers said:

Fairfax’s float grew to $33-billion by the end of 2023, while the company’s market capitalization recently reached nearly $26-billion. By comparison, Berkshire had an insurance float of US$3-billion versus a US$26-billion market capitalization in early 1995, before Mr. Buffett used Berkshire’s shares to acquire Geico and Gen Re to materially increase Berkshire’s float. Today, Berkshire has a float of US$169-billion and a market capitalization of US$856-billion.

 

This is the key to the argument, I think. With Fairfax, you have float of $33b with $22b of equity (2023 year end numbers), whereas for Berkshire, you have float of $169b with equity of $561b. So $1 of equity is increased to $2.50 of investable assets with Fairfax, whereas with Berkshire, $1 of equity is increased to  $1.23 of investable assets. Fairfax is twice as leveraged by investment float. So if you think the key to success of Berkshire was the float leverage, Fairfax is a much better setup. If you think the key to Berkshire's success was investment savvy (an argument that it would be hard to support from the last 20 years of performance), then it's less clear that Fairfax is a good investment.

 

Since I favour the view that it is Berkshire's structure that has been the key to its success, at least in the last 30 years, I really like how Fairfax is positioned right now.

[SafetyinNumbers]

4 hours ago, TwoCitiesCapital said:

 

I know the analyst who used to work for Semper Augustus. The view of FFH was too much blow-up risk at FFH. 

 

I dunno if that was from the insurance side or beunf uncomfortable with shorting/derivatives/investments etc, but that was the reason they were uninterested in FFH and Fairfax India when I was discussing them with him. 

I don’t think a probabilistic investor would come to that conclusion. The complexity is designed to reduce risk and increase returns. 
 

Regardless, it’s a poor argument to make now based on the outlook in which surplus capital is about to skyrocket. The thing that makes Bloomstran pick BRK over FFH is its surplus capital. FFH is about to be swimming in it. In theory the increased durability should increase social value and returns.

[SafetyinNumbers]

47 minutes ago, dartmonkey said:

 

This is the key to the argument, I think. With Fairfax, you have float of $33b with $22b of equity (2023 year end numbers), whereas for Berkshire, you have float of $169b with equity of $561b. So $1 of equity is increased to $2.50 of investable assets with Fairfax, whereas with Berkshire, $1 of equity is increased to  $1.23 of investable assets. Fairfax is twice as leveraged by investment float. So if you think the key to success of Berkshire was the float leverage, Fairfax is a much better setup. If you think the key to Berkshire's success was investment savvy (an argument that it would be hard to support from the last 20 years of performance), then it's less clear that Fairfax is a good investment.

 

Since I favour the view that it is Berkshire's structure that has been the key to its success, at least in the last 30 years, I really like how Fairfax is positioned right now.

Another way to frame it is because of the profitable float leverage, the equity returns don’t have to be high to earn a 15% ROE but they could be and I’m betting they will be without having to pay for it. 

[Viking]

1 hour ago, dartmonkey said:

 

This is the key to the argument, I think. With Fairfax, you have float of $33b with $22b of equity (2023 year end numbers), whereas for Berkshire, you have float of $169b with equity of $561b. So $1 of equity is increased to $2.50 of investable assets with Fairfax, whereas with Berkshire, $1 of equity is increased to  $1.23 of investable assets. Fairfax is twice as leveraged by investment float. So if you think the key to success of Berkshire was the float leverage, Fairfax is a much better setup. If you think the key to Berkshire's success was investment savvy (an argument that it would be hard to support from the last 20 years of performance), then it's less clear that Fairfax is a good investment.

 

Since I favour the view that it is Berkshire's structure that has been the key to its success, at least in the last 30 years, I really like how Fairfax is positioned right now.

@dartmonkey , i think there are 2 keys when comparing Fairfax and Berkshire today:

1.) leverage: Fairfax is much more levered to float. All things being equal, that should contribute to outperformance. 
2.) size: Fairfax is much smaller. The opportunities available to it are much larger. AND the impact of good decisions will have a much quicker and larger impact on reported results. 

For proof, all you have to do is look at capital allocation at Fairfax and Berkshire Hathaway over the last 4 years. There is no comparison. That is not being critical of Berkshire Hathaway - it is an aging elephant. 

[Viking]

4 hours ago, SafetyinNumbers said:

I don’t think a probabilistic investor would come to that conclusion. The complexity is designed to reduce risk and increase returns. 
 

Regardless, it’s a poor argument to make now based on the outlook in which surplus capital is about to skyrocket. The thing that makes Bloomstran pick BRK over FFH is its surplus capital. FFH is about to be swimming in it. In theory the increased durability should increase social value and returns.

Fairfax of 10 years ago looks little like the Fairfax of today. So many ‘Fairfax pundits’ from 10 years ago do not recognize this change. There have been two game changers that have played out/accelerated over the past 4 years:

1.) capital allocation: the senior team at Fairfax has hit the ball out of the park the past 4 years. It is surfaced billions in shareholder value.
2.) the size of the increase in operating cash flow - and the fact it is largely locked and loaded for the next 4 years.

 

As a result, Fairfax is now entering uncharted territory as a company (for it). We are all still learning what baseline earnings are. The financial positioning/quality of the company has improved markedly. The bond ratings agencies (AM Best - insurance specialists) are ahead of the equity analysts in this regard - which is surprising (to me at least).
 

The people who are likely at the biggest disadvantage when it comes to Fairfax today are those who believed in the company and then bailed in 2018 to 2020 (stop the pain). And the detractors / haters. These investors/groups have the most to unlearn.

 

—————

Fairfax’s business and its future prospects have undergone a paradigm shift the past 4 years. One that many smart people don’t fully grasp today. 

“The disadvantage of a mind-set is that it can color and control our perception to the extent that an experienced specialist may be among the last to see what is really happening when events take a new and un-expected turn. When faced with a major paradigm shift, analysts who know the most about a subject have the most to unlearn. This seems to have happened before the reunification of Germany, for example. Some German specialists had to be prodded by their more generalist supervi- sors to accept the significance of the dramatic changes in progress toward reunification of East and West Germany.” Page 5, Psychology of Intelligence Analysis by Richards J. Heuer, Jr.

 

PDF copy of the book can be downloaded for free: https://www.ialeia.org/docs/Psychology_of_Intelligence_Analysis.pdf

 

Edited May 2 by Viking

[UK]

13 hours ago, gfp said:

pdf of the article.  Go ahead and remove it if an opinion section excerpt is some kind of copyright issue.

Why Fairfax Financial.pdf 35.13 kB · 47 downloads

 

The Security I Like Best:). Nice!

[Spooky]

I like Fairfax's setup here and have added some more to my position recently. But aren't we all jumping the gun comparing it to Berkshire and their position in 1995? To match Berkshire's track record going forward, Fairfax is going to need to significantly shift its asset allocation from 75% bonds to predominantly equities. As a Canadian company, will Fairfax be allowed to do this by insurance regulators (I'm ignorant on the rules here but there must be differences between the US and Canada)? Also, this shift presumes that there will be good opportunities to buy wonderful companies at fair prices that Fairfax can easily shift capital into. Is the investing environment going forward going to be conducive to doing this? Buffett himself has written that the investment arena is much more competitive now and there aren't as many easy opportunities as there were in the past. There are also many people out there now trying to implement the Munger playbook. Lastly, have we seen that Fairfax is able to identify and buy these compounders / wonderful companies? Where are the Coca-Cola's, Amex's, See's Candies, Apples in their portfolio today? Which companies in their portfolio have high returns on assets, are growing and have durable moats?

[Xerxes]

39 minutes ago, Spooky said:

I like Fairfax's setup here and have added some more to my position recently. But aren't we all jumping the gun comparing it to Berkshire and their position in 1995? To match Berkshire's track record going forward, Fairfax is going to need to significantly shift its asset allocation from 75% bonds to predominantly equities. As a Canadian company, will Fairfax be allowed to do this by insurance regulators (I'm ignorant on the rules here but there must be differences between the US and Canada)? Also, this shift presumes that there will be good opportunities to buy wonderful companies at fair prices that Fairfax can easily shift capital into. Is the investing environment going forward going to be conducive to doing this? Buffett himself has written that the investment arena is much more competitive now and there aren't as many easy opportunities as there were in the past. There are also many people out there now trying to implement the Munger playbook. Lastly, have we seen that Fairfax is able to identify and buy these compounders / wonderful companies? Where are the Coca-Cola's, Amex's, See's Candies, Apples in their portfolio today? Which companies in their portfolio have high returns on assets, are growing and have durable moats?

 

to flip this comment, we could ask if Berkshire had $25 billion market cap today in 2024, does one expect it to have a portfolio filled with “Coca-Cola's, Amex's, See's Candies, Apples” and the likes of it. 

probably not 

 

[Spooky]

38 minutes ago, Xerxes said:

 

to flip this comment, we could ask if Berkshire had $25 billion market cap today in 2024, does one expect it to have a portfolio filled with “Coca-Cola's, Amex's, See's Candies, Apples” and the likes of it. 

probably not 

 

 

Buffett bought $1B in Coca-Cola in 1988 so before they were the size Fairfax is currently. They also bought Amex a few years later in the early 90s. They had See's Candy much sooner.

[thowed]

21 minutes ago, Spooky said:

 

Buffett bought $1B in Coca-Cola in 1988 so before they were the size Fairfax is currently. They also bought Amex a few years later in the early 90s. They had See's Candy much sooner.

 

I suspect what Xerxes is suggesting is that in 2024 there is a much broader option of companies (e.g. Tech) compared with mid-1990s.

 

Personally I think there is much to like about Fairfax, but I'm not going to spend more time trying to compare it to 90s Berkshire.

 

Cheers!

[Viking]

4 hours ago, Spooky said:

 

Buffett bought $1B in Coca-Cola in 1988 so before they were the size Fairfax is currently. They also bought Amex a few years later in the early 90s. They had See's Candy much sooner.

Comparing Berkshire Hathaway with Fairfax Financial - some thoughts.
 

When Buffett first bought AMEX and Coca-Cola were they viewed at the time like they were brilliant investments? No, of course they weren’t. It often takes a decade or longer - after the purchase - to evaluate/appreciate a brilliant capital allocation decision.

 

Example 1

From 2018-2023, Fairfax invested $2 billion and now owns 15.5% of a high quality company. The average price paid that was about 1/3 of its current intrinsic value (conservatively valued). They bought high quality at an exceptionally low price. And they backed up the truck - $2 billion is a lot of money (at the time, common shareholders equity was around $13 billion).
 

But the story gets even better. In late 2020/2021, Fairfax got exposure to another 7.5% of the very same high quality company. This time they paid about 28% of current intrinsic value. 
 

In total, they ‘purchased’ about 23% of this company, paying on average about 30% of current intrinsic value. This investment is poised to compound at mid to high teens in the coming years. 
 

Hello people… have you been paying attention? (Yes, the company they bought is called Fairfax.)

 

Example 2

In Q4 2021, Fairfax sold most of their corporate bonds and dropped the average duration of their fixed income portfolio to 1.2 years. In Q4 2023 they extended the average duration of their fixed income portfolio to +3 years. What they did with their fixed income portfolio saved the company $3 billion? (or more?) in unrealized bond losses. Because duration was so short, the earn through from spiking interest rates was immediate in 2022 and 2023. Today they are earning $2 billion in interest income and it is now largely locked in for the next 4 years. They protected their balance, pivoted and are now earnings record interest and dividend income - the highest quality income stream a P/C insurer can have. 
 

Fairfax’s financial profile (and future) has been permanently changed (improved) as a result of these actions. Ask AM Best if you don’t believe me.
 

The parallels with a much younger Berkshire Hathaway

 

“History does not repeat itself, but it rhymes.” Mark Twain

 

Investors waiting for Fairfax to buy ‘Coke’ or ‘American Express’ in 2024 will likely be sorely disappointed. For two reasons:

1.) Buffett’s brilliance wasn’t buying Coke or American Express. It was exploiting the set of circumstances that existed at the time, which served up Coke in 1988 and AMEX in 1990.

2.) Like Berkshire when it made its many brilliant moves, most investors probably won’t see it when Fairfax actually does it.
 

How do I know this? Because Fairfax has been making exceptional capital allocation decisions for years now. For a couple of these they got out their elephant gun. And they still get no (little) credit. And that is because the company continues to be misunderstood. The moves Fairfax has been making continue to be grossly under appreciated. Just like when Buffett made his great investments, investors need more time to fully appreciate the brilliance of what Fairfax has executed in recent years.
 

If lots of people on this board don’t see it… do you think the rest of the investor community does? That’s why the stock trades at 1.1x book value - crazy cheap. 

 

The key lesson for investors

 

The world is different today - the set of circumstances is ever changing. Importantly, with normalized - higher - interest rates, volatility in financial markets is back. We had bear markets in stocks in 2020 and again in 2022. We had a historic bear market in bonds in 2022. And just look at what Fairfax has been doing. Most investors still can’t see what is right in front of their face. Because they are looking for the wrong thing.
 

Active management can have a huge impact on financial results. Now most P/C insurance companies don’t actively manage their investment portfolio. Fairfax does.

Fairfax today:

1.) They are run by a genius - yes, anyone who can compound book value at 18.4% for 38 years is a genius. What is Prem’s greatest strength? Perhaps his ability to attract and retain talent, beginning with the creation of Hamblin Walsa 38 years ago and continuing with the guys running insurance like Andy Barnard.
2.) They are family controlled - importantly, this allows for long term decision making. Along the same line, this also allows them to take full advantage of volatility, even if it takes some time to work out.

3.) They have Hambin Watsa - handles all capital allocation decisions.

4.) Capital allocation - They use a value investing framework. This appears to be evolving over time. Today, they appear to be placing more of a premium on management. And financial strength/profitability. ‘Quality at a fair price’ versus classic Graham ‘deep value’ type investing.
5.) They are highly levered to float. Its cost is better than free (they are actually getting paid to hold it) and it is growing in size.

6.) Culture - insurance and investments are run on a decentralized model.

7.) They invest a large part of their investment portfolio in equities. Most traditional P/C insurance companies stick to fixed income investments.

8.) They are still a small company - this gives them a very large opportunity set.

9.)  They have their elephant gun out. 
10.) They are able to move with speed.

11.) They have been generating an enormous amount of cash the past couple of years and this is set to continue in the coming years (net earnings of around $4 billion per year?).

12.) They are on a hot streak - when it comes to capital allocation.
13.) And volatility - more normal financial markets - is back. So lots of opportunities will be coming in the future.

14.) Compounding - as always - sits ready to work its magic.

This set-up looks an awful lot like a much younger Berkshire Hathaway. 
 

But what Fairfax does/how they execute will likely not look anything like what Berkshire Hathaway did back in the 1980’s. And that is because history does not repeat exactly. But it sometimes rhymes. And I think this might be one of those times.

 

Today, Berkshire Hathaway is like an aging elephant. And Fairfax is like a lion in its prime. And the drought (zero interest rates) has ended - and the savannah is once again teeming with game. 

Edited May 2 by Viking

[gfp]

On 5/1/2024 at 10:56 AM, Viking said:

Fairfax has some pretty big cash outlays in Q1:

• Dividend ($15/share) = $375 million
• Stock buybacks = $125 million? 125,000 shares @ $1,000/share?

 

Seems like FFH share repurchases should come in around $195 million in the quarter but I may be double counting some shares.  We'll see how far off I am later.

https://ceo.ca/api/sedi/?symbol=ffh&amount=&transaction=&insider=Fairfax

[SafetyinNumbers]

5 hours ago, Spooky said:

I like Fairfax's setup here and have added some more to my position recently. But aren't we all jumping the gun comparing it to Berkshire and their position in 1995? To match Berkshire's track record going forward, Fairfax is going to need to significantly shift its asset allocation from 75% bonds to predominantly equities. As a Canadian company, will Fairfax be allowed to do this by insurance regulators (I'm ignorant on the rules here but there must be differences between the US and Canada)? Also, this shift presumes that there will be good opportunities to buy wonderful companies at fair prices that Fairfax can easily shift capital into. Is the investing environment going forward going to be conducive to doing this? Buffett himself has written that the investment arena is much more competitive now and there aren't as many easy opportunities as there were in the past. There are also many people out there now trying to implement the Munger playbook. Lastly, have we seen that Fairfax is able to identify and buy these compounders / wonderful companies? Where are the Coca-Cola's, Amex's, See's Candies, Apples in their portfolio today? Which companies in their portfolio have high returns on assets, are growing and have durable moats?

BRK has returned a little over 12% CAGR since the late 90s and has had some multiple contraction. I find it difficult for FFH BV to not double or more in the next 5 years which is a nice start. If FFH can do that I think we will almost surely see multiple expansion over that period which makes it an even better start. How the compounding story goes after that is harder to predict but I think they are going to be disciplined which doesn’t mean they won’t make mistakes but as it stands now they are painting a masterpiece. 

[Xerxes]

3 hours ago, Viking said:

Berkshire Hathaway is like an aging elephant. And Fairfax is like a lion in its prime. 

Berkshire Hathaway 25 years from now. … with Wall Street watching.  
 

 

[Viking]

12 minutes ago, Xerxes said:

Berkshire Hathaway 25 years from now. … with Wall Street watching.  
 

 

@Xerxes you have a wicked sense of humour. I laughed out loud when i read your post and saw the picture. 

[thowed]

Thanks, @gfp.  Sorry to ask a stupid question, but I'm confused as to why some of the shares purchases are at a much lower price e.g. 11-19 March.  Are they occasionally buying the US$ OTC FRFHF??  These are much lower amounts.

[Spooky]

5 hours ago, Viking said:

Comparing Berkshire Hathaway with Fairfax Financial - some thoughts.
 

When Buffett first bought AMEX and Coca-Cola were they viewed at the time like they were brilliant investments? No, of course they weren’t. It often takes a decade or longer - after the purchase - to evaluate/appreciate a brilliant capital allocation decision.

 

Example 1

From 2018-2023, Fairfax invested $2 billion and now owns 15.5% of a high quality company. The average price paid that was about 1/3 of its current intrinsic value (conservatively valued). They bought high quality at an exceptionally low price. And they backed up the truck - $2 billion is a lot of money (at the time, common shareholders equity was around $13 billion).
 

But the story gets even better. In late 2020/2021, Fairfax got exposure to another 7.5% of the very same high quality company. This time they paid about 28% of current intrinsic value. 
 

In total, they ‘purchased’ about 23% of this company, paying on average about 30% of current intrinsic value. This investment is poised to compound at mid to high teens in the coming years. 
 

Hello people… have you been paying attention? (Yes, the company they bought is called Fairfax.)

 

Example 2

In Q4 2021, Fairfax sold most of their corporate bonds and dropped the average duration of their fixed income portfolio to 1.2 years. In Q4 2023 they extended the average duration of their fixed income portfolio to +3 years. What they did with their fixed income portfolio saved the company $3 billion? (or more?) in unrealized bond losses. Because duration was so short, the earn through from spiking interest rates was immediate in 2022 and 2023. Today they are earning $2 billion in interest income and it is now largely locked in for the next 4 years. They protected their balance, pivoted and are now earnings record interest and dividend income - the highest quality income stream a P/C insurer can have. 
 

Fairfax’s financial profile (and future) has been permanently changed (improved) as a result of these actions. Ask AM Best if you don’t believe me.
 

The parallels with a much younger Berkshire Hathaway

 

“History does not repeat itself, but it rhymes.” Mark Twain

 

Investors waiting for Fairfax to buy ‘Coke’ or ‘American Express’ in 2024 will likely be sorely disappointed. For two reasons:

1.) Buffett’s brilliance wasn’t buying Coke or American Express. It was exploiting the set of circumstances that existed at the time, which served up Coke in 1988 and AMEX in 1990.

2.) Like Berkshire when it made its many brilliant moves, most investors probably won’t see it when Fairfax actually does it.
 

How do I know this? Because Fairfax has been making exceptional capital allocation decisions for years now. For a couple of these they got out their elephant gun. And they still get no (little) credit. And that is because the company continues to be misunderstood. The moves Fairfax has been making continue to be grossly under appreciated. Just like when Buffett made his great investments, investors need more time to fully appreciate the brilliance of what Fairfax has executed in recent years.
 

If lots of people on this board don’t see it… do you think the rest of the investor community does? That’s why the stock trades at 1.1x book value - crazy cheap. 

 

The key lesson for investors

 

The world is different today - the set of circumstances is ever changing. Importantly, with normalized - higher - interest rates, volatility in financial markets is back. We had bear markets in stocks in 2020 and again in 2022. We had a historic bear market in bonds in 2022. And just look at what Fairfax has been doing. Most investors still can’t see what is right in front of their face. Because they are looking for the wrong thing.
 

Active management can have a huge impact on financial results. Now most P/C insurance companies don’t actively manage their investment portfolio. Fairfax does.

Fairfax today:

1.) They are run by a genius - yes, anyone who can compound book value at 18.4% for 38 years is a genius. What is Prem’s greatest strength? Perhaps his ability to attract and retain talent, beginning with the creation of Hamblin Walsa 38 years ago and continuing with the guys running insurance like Andy Barnard.
2.) They are family controlled - importantly, this allows for long term decision making. Along the same line, this also allows them to take full advantage of volatility, even if it takes some time to work out.

3.) They have Hambin Watsa - handles all capital allocation decisions.

4.) Capital allocation - They use a value investing framework. This appears to be evolving over time. Today, they appear to be placing more of a premium on management. And financial strength/profitability. ‘Quality at a fair price’ versus classic Graham ‘deep value’ type investing.
5.) They are highly levered to float. Its cost is better than free (they are actually getting paid to hold it) and it is growing in size.

6.) Culture - insurance and investments are run on a decentralized model.

7.) They invest a large part of their investment portfolio in equities. Most traditional P/C insurance companies stick to fixed income investments.

8.) They are still a small company - this gives them a very large opportunity set.

9.)  They have their elephant gun out. 
10.) They are able to move with speed.

11.) They have been generating an enormous amount of cash the past couple of years and this is set to continue in the coming years (net earnings of around $4 billion per year?).

12.) They are on a hot streak - when it comes to capital allocation.
13.) And volatility - more normal financial markets - is back. So lots of opportunities will be coming in the future.

14.) Compounding - as always - sits ready to work its magic.

This set-up looks an awful lot like a much younger Berkshire Hathaway. 
 

But what Fairfax does/how they execute will likely not look anything like what Berkshire Hathaway did back in the 1980’s. And that is because history does not repeat exactly. But it sometimes rhymes. And I think this might be one of those times.

 

Today, Berkshire Hathaway is like an aging elephant. And Fairfax is like a lion in its prime. And the drought (zero interest rates) has ended - and the savannah is once again teeming with game. 

 

What I'm driving at is it is one thing for Fairfax to talk about buying wonderful / good companies and just letting them compound versus actually executing on that plan. I like the idea but right now when I look at Fairfax it looks more like a leveraged bond fund with a side of value investments rather than a Berkshire Hathaway in 1995. Which investments in Fairfax's portfolio today are wonderful companies (i.e. high return on assets and growing) that can just keep compounding at high rates of return for the next 20-30 years? When Berkshire buys back stock, you as a shareholder are getting a higher ownership percentage of the wonderful businesses they own. Certainly Fairfax has set themselves up well going forward, hopefully the investing environment co-operates and throws them some fat pitches. Let's see, I'll be watching with interest.

 

 

 

Edited May 2 by Spooky

[Hoodlum]

Here is the announcement of the Odyssey Re succession plan completion.

 

https://odysseyre.com/news/odyssey-group-announces-leadership-change/

 

Quote

 

Odyssey Reinsurance Company’s global CEO, Carl Overy, will succeed Brian Young as CEO of Odyssey Group effective January 1, 2025. This appointment coincides with Mr. Young’s move to Fairfax, where he will serve as president of Fairfax Insurance Group. Mr. Young will work alongside Andrew Barnard, who will assume the role as chairman of Fairfax Insurance Group, and, together, they will provide management oversight of Fairfax’s expansive global (re)insurance operations.

 

Mr. Overy will be responsible for Odyssey Group’s global operations, overseeing its three underwriting franchises: OdysseyRe, Hudson Insurance Group and Newline Group. Mr. Overy’s tenure at Odyssey Group spans more than 20 years. He was appointed global CEO of OdysseyRe in 2023 and previously served for 15 years as the CEO of Odyssey Group’s London Market Division, which encompasses both the London branch of Odyssey Reinsurance Company and Newline Group, the international insurance arm of Odyssey Group.

 

 

[SafetyinNumbers]

31 minutes ago, Spooky said:

 

What I'm driving at is it is one thing for Fairfax to talk about buying wonderful / good companies and just letting them compound versus actually executing on that plan. I like the idea but right now when I look at Fairfax it looks more like a leveraged bond fund with a side of value investments rather than a Berkshire Hathaway in 1995. Which investments in Fairfax's portfolio today are wonderful companies (i.e. high return on assets and growing) that can just keep compounding at high rates of return for the next 20-30 years? When Berkshire buys back stock, you as a shareholder are getting a higher ownership percentage of the wonderful businesses they own. Certainly Fairfax has set themselves up well going forward, hopefully the investing environment co-operates and throws them some fat pitches. Let's see, I'll be watching with interest.

 

 

 

The only things similar about Berkshire in 1995 and Fairfax is the market cap. The investments/share, float/share, premiums/share, surplus capital and P/B are all quite different. 

[Spooky]

14 minutes ago, SafetyinNumbers said:

The only things similar about Berkshire in 1995 and Fairfax is the market cap. The investments/share, float/share, premiums/share, surplus capital and P/B are all quite different. 

 

Didn't you just write an article alluding FFH is following in the footsteps of BRK which "shot up 27 times after it reached the size Fairfax is now"?

[SafetyinNumbers]

15 minutes ago, Spooky said:

 

Didn't you just write an article alluding FFH is following in the footsteps of BRK which "shot up 27 times after it reached the size Fairfax is now"?

I did. They have the same business model and size but very different set ups. I think Fairfax’s stock is an easier bet now than Berkshire”s stock was then based on the set ups. That’s the point I was trying to make. 

[Spooky]

2 minutes ago, SafetyinNumbers said:

I did. They have the same business model and size but very different set ups. I think Fairfax’s stock is an easier bet now than Berkshire”s stock was then based on the set ups. That’s the point I was trying to make. 

 

I hope you're right. We just need to be careful about believing it because we want to believe it.