Market expectations vs CoBF expectations

[SafetyinNumbers]

This poll was inspired by this terrific interview w/ Bill Nygren. I posted the same poll on Twitter and thought it might be interesting to see how the responses differ if at all. 
 

https://www.fool.com/investing/2024/01/17/next-great-value-stock-bill-nygren-explains/

 

 

[nwoodman]

I tend to agree.  There has been enough examples of valuation extremes over the last couple of years to suggest to me that the market is becoming less efficient rather than more so.  This aligns with the view that it is passive (dumb) capital that is sloshing around.  Throw in leverage and a speculative element and you have the underpinnings of some of these valuation extremes.  This has created a lot of opportunities as is evidenced by some of the stellar performances by CoBF board members.
 

As discussed at length, if Fairfax can move up in quality i.e. GARP then they should do 10%+.  Looking at their current portfolio I would say they have a fair shot at doing this with their Greek and Indian  exposure.  Who knows even OXY might be able eke out 10%+.  There is an asymmetry to that investment with Berkshire providing a $55 put that is appealing.

[SafetyinNumbers]

2 minutes ago, nwoodman said:

As discussed at length, if Fairfax can move up in quality i.e. GARP then they should do 10%+.  Looking at their current portfolio I would say they have a fair shot at doing this with their Greek and Indian  exposure.  Who knows even OXY might be able eke out 10%+.  There is an asymmetry to that investment with Berkshire providing a $55 put that is appealing.

That’s interesting. I think quality tends to trade in or above its intrinsic value range if the underlying is very liquid and has predictable earnings streams. I think picking idiosyncratic ideas from everything left over has a good chance of success.