gfp Posted January 10 Posted January 10 And to everyone saying, "doctors don't make $95 million" or whatever, I just want to point out that I'm talking about doctors who also found the last Berkshire Hathaway and are only now looking for the next Berkshire Hathaway because their guy is hanging up his spurs.
UK Posted January 10 Posted January 10 On 1/9/2026 at 3:12 PM, gfp said: Little by little the story is getting picked up by the mainstream. And just as W and C, they are also trying to get into womens underware...
Viking Posted January 11 Posted January 11 4 hours ago, yqsun said: I thought Kyle did a very good job with his historical overview of Fairfax - not an easy thing to do (it is easy to get distracted). Bottom line, the company has been able to compound at 19% per year for 40 years (stock, US$). Yes, I think we can say Fairfax is an exceptional business/company.
Marco Van Basten Posted January 11 Posted January 11 4 hours ago, Viking said: I thought Kyle did a very good job with his historical overview of Fairfax - not an easy thing to do (it is easy to get distracted). Bottom line, the company has been able to compound at 19% per year for 40 years (stock, US$). Yes, I think we can say Fairfax is an exceptional business/company. I am not sure that I agree with you. There is no doubt in my mind that Mr Watsa and the team that he has assembled are exceptional. In my opinion, Fairfax is a decent business run by an exceptional team, why do you think that the business is exceptional? Ferrari is an exceptional business, so is Moody's, but insurance is ultimately a commodity, no? Unless you have an all star team which is what Fairfax seems to have.
SafetyinNumbers Posted January 11 Posted January 11 1 hour ago, Marco Van Basten said: I am not sure that I agree with you. There is no doubt in my mind that Mr Watsa and the team that he has assembled are exceptional. In my opinion, Fairfax is a decent business run by an exceptional team, why do you think that the business is exceptional? Ferrari is an exceptional business, so is Moody's, but insurance is ultimately a commodity, no? Unless you have an all star team which is what Fairfax seems to have. The structure is exceptional. It’s why the returns are high and it’s not well understood.
Malmqky Posted January 11 Posted January 11 1 hour ago, Marco Van Basten said: I am not sure that I agree with you. There is no doubt in my mind that Mr Watsa and the team that he has assembled are exceptional. In my opinion, Fairfax is a decent business run by an exceptional team, why do you think that the business is exceptional? Ferrari is an exceptional business, so is Moody's, but insurance is ultimately a commodity, no? Unless you have an all star team which is what Fairfax seems to have. Equities investments + float are a great business...if you have a good team.
SafetyinNumbers Posted January 11 Posted January 11 8 minutes ago, Malmqky said: Equities investments + float are a great business...if you have a good team. Fairfax also adds some leverage at the holdco level which boosts the investment:equity leverage a bit more.
Viking Posted January 12 Posted January 12 (edited) 2 hours ago, Marco Van Basten said: I am not sure that I agree with you. There is no doubt in my mind that Mr Watsa and the team that he has assembled are exceptional. In my opinion, Fairfax is a decent business run by an exceptional team, why do you think that the business is exceptional? Ferrari is an exceptional business, so is Moody's, but insurance is ultimately a commodity, no? Unless you have an all star team which is what Fairfax seems to have. “Why do you think the business is exceptional?” @Marco Van Basten, Fairfax’s stock has compounded at 19% for 40 years (dividend reinvested, US$). That is an exceptional business. And I don’t think it is debatable. William Thorndike in his book The Outsiders, said judge management by their performance. And the best way to measure performance is the change in the share price over the long term. Simple. Powerful. Yes, insurance is a commodity. And it can be a wonderful business. Fairfax is just one of many examples. There are many ingredients in Fairfax’s secret sauce: Founder/CEO Ownership structure - allowing long term focus Company structure (centralized capital allocation, decentralized operations) Investment management (fixed income and equities). Company culture Shareholder friendly ---------- From Fairfax's AGM presentation (April 2025): Edited January 12 by Viking
djokovic1 Posted January 12 Posted January 12 The business is exceptional because very very few insurers also invest well (especially actively manage equities). You can count them on one hand. Combination of profitable underwriting when compounded with investing the float wisely is what makes P&C insurance a great business. Easy to model in an excel but hard to do in practice like Berkshire and FFH have shown. Others have tried and failed, most dont try.
Viking Posted January 12 Posted January 12 (edited) 10 minutes ago, djokovic1 said: The business is exceptional because very very few insurers also invest well (especially actively manage equities). You can count them on one hand. Combination of profitable underwriting when compounded with investing the float wisely is what makes P&C insurance a great business. Easy to model in an excel but hard to do in practice like Berkshire and FFH have shown. Others have tried and failed, most dont try. I agree. Most publicly traded P/C insurance companies can’t accept short term volatility. So equities are off the table as investments. Despite the fact they can deliver a much higher return over the long term. This gives Fairfax a structural return advantage. Time and compounding magnifies this advantage. Edited January 12 by Viking
Marco Van Basten Posted January 12 Posted January 12 We will have to agree to disagree. In my opinion, it is not the business that is exceptional, Mr Watsa and his team are exceptional and they make an average or commodity business generate a superb return.
djokovic1 Posted January 12 Posted January 12 (edited) I then disagree with your definition of the business. You are defining the business as just insurance. The business is insurance + investing (with the amazing addition of leverage through float which is because of the insurance business)-> not to be forgotten!. The outcomes of which of course are driven by quality of management and alignment. But yes I agree its not a Moody's etc... Edited January 12 by djokovic1
roundball100 Posted January 12 Posted January 12 24 minutes ago, Marco Van Basten said: We will have to agree to disagree. In my opinion, it is not the business that is exceptional, Mr Watsa and his team are exceptional and they make an average or commodity business generate a superb return. I am guessing that the misunderstanding here is due to the ambiguity of whether "business" means "specific company", or "industry as a whole".
Marco Van Basten Posted January 12 Posted January 12 1 hour ago, roundball100 said: I am guessing that the misunderstanding here is due to the ambiguity of whether "business" means "specific company", or "industry as a whole". You are right. To me, an exceptional business is one that earns superior economic returns and ideally can grow with attractive returns on capital without relying on exceptional management team. An idiot can run Vulcan materials, and have run it in the past, and the returns have been incredible, similarly with MO. You get an idiot to run an insurance company, it goes bankrupt, you get an okay management team, and you get mediocre returns.
Txvestor Posted January 12 Posted January 12 2 hours ago, Viking said: I agree. Most publicly traded P/C insurance companies can’t accept short term volatility. So equities are off the table as investments. Despite the fact they can deliver a much higher return over the long term. This gives Fairfax a structural return advantage. Time and compounding magnifies this advantage. If you were to take that 40yr run, and split in 2 halves. I think you would get two stories, much faster compound rate for the first half. They have done better over the last 5 yrs but that's after a very long lean run.
Viking Posted January 12 Posted January 12 12 minutes ago, Txvestor said: If you were to take that 40yr run, and split in 2 halves. I think you would get two stories, much faster compound rate for the first half. They have done better over the last 5 yrs but that's after a very long lean run. I think it is more nuanced than that. When it comes to insurance, Fairfax’s core engine, was the first 20 years better than the last 20 years? What Fairfax has done with their insurance business the past 10 years has been epic: Aggressive growth by acquisitions in the soft market Strong organic growth in the hard market Structural improvement in underwriting What I am most focussed on with Fairfax is today. I really like how the company is positioned. A big reason for that is how well they have performed over the past 5 years (both insurance, investments and capital allocation). Mid-teens ROE looks like a conservative baseline. Monetizing the growing hidden value will be a tailwind to ROE. And yes, there will be some volatility.
sholland Posted January 12 Posted January 12 On 1/11/2026 at 7:39 AM, yqsun said: I learned a new phrase - “cannibal buyout” - do a buyout with a partner and then over time buyout the partner.
CharlesMunger Posted January 12 Posted January 12 On 1/8/2026 at 1:05 PM, Hoodlum said: Thanks for posting @CharlesMunger I noticed the larger trade on 12/16 for 50k through Scotia under the CBOE trading network, but initially thought it was for 100k. There was a similar 109k buyback done on 11/11. Scotia is who Fairfax uses for buybacks and it looks like they use the CBOE trading network for some of their larger buybacks. 12/16 11/11 Another 50k today at the opening?
Hoodlum Posted January 12 Posted January 12 1 minute ago, CharlesMunger said: Another 50k today at the opening? I noticed that as well. My free subscription to Stockwatch expired so I no longer have visibility to who was the buyer/seller.
gfp Posted January 12 Posted January 12 6 minutes ago, CharlesMunger said: Another 50k today at the opening? same doctor. must be in it for that fat dividend.
Crip1 Posted January 12 Posted January 12 10 minutes ago, gfp said: same doctor. must be in it for that fat dividend. Not sure if this is tongue-in-cheek or not. But, if not, I would be surprised if anyone bought FFH for the divvy. There are many companies paying quarterly dividends at a higher yield than FFH, and many of them have notably higher liquidity as they are traded much more actively. Stated differently, there are much better ways to get a quick 0.8% in the short term. -Crip
gfp Posted January 12 Posted January 12 10 minutes ago, Crip1 said: Not sure if this is tongue-in-cheek or not. But, if not, I would be surprised if anyone bought FFH for the divvy. There are many companies paying quarterly dividends at a higher yield than FFH, and many of them have notably higher liquidity as they are traded much more actively. Stated differently, there are much better ways to get a quick 0.8% in the short term. -Crip it was a joke. Obviously didn't land
Txvestor Posted January 12 Posted January 12 23 minutes ago, gfp said: same doctor. must be in it for that fat dividend. Maybe Dr Prem Watsa is buying? Are we sure these aren't block buybacks?
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