Fairholme/Berkowitz

[JRH]

http://news.morningstar.com/articlenet/article.aspx?id=596434&pgid=rss

 

Those investments were rewarded early this week as news of the settlement lifted the prices both of MBIA's stock and its bonds. The result? Fairholme Focused Income surged 11% in one day and a total of 15% across a three-day period, while the flagship Fairholme fund also enjoyed a more modest 3% lift from the MBIA news.

 

Has an "income style mutual fund" EVER moved up 11% in one day?  :o

 

Especially one 40% in cash?! ;)

[indythinker85]

Hes up 20% this year not bad. I have a friend who is a value analyst at a top small cap firm which keeps low profile. He told me 60% of his money was in MBI (before the news) and i told him it was too risky. Anyway, he is probably a millionaire now.

[JRH]

New 13F filed... CHK, CNQ, GNW are new positions.

 

Edit: Only CHK position is of meaningful size.  Genworth is an interesting choice at this point.  Do you think he watched it rise hundreds of percent off its lows, patiently waiting to be certain before pulling the trigger? (the BofA template?)

[PlanMaestro]

Genworth is an interesting choice at this point.  Do you think he watched it rise hundreds of percent off its lows, patiently waiting to be certain before pulling the trigger? (the BofA template?)

 

Extract from an email I sent last week to a known blogger that was asking about Life Insurance in general and Genworth in particular.

 

Here are some comments on Genworth from a year ago. After the run-up, they look stupidly conservative but remember that at that time the world was going to collapse (once again) and there were plenty of cheap financials. Also, it's not much of a life company.

http://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/gnw-genworth-financial/msg82841/#msg82841

 

From last year, I would say the thing that changed the most is that the regulator concerns are much less of an issue now. It's very cheap but still a crappy business. I would guess, considering the similar position sizing to the warrants, that he likes the upside but sees some small probability of catastrophe.

[racemize]

Is there a reason data roma and whale wisdom have different data for Berkowitz?  (And is this an issue for others)?

 

 

http://whalewisdom.com/filer/fairholme-capital-management-llc

 

http://www.dataroma.com/m/holdings.php?m=fairx

[biaggio]

Is there a reason data roma and whale wisdom have different data for Berkowitz?  (And is this an issue for others)?

 

 

http://whalewisdom.com/filer/fairholme-capital-management-llc

 

http://www.dataroma.com/m/holdings.php?m=fairx

 

They appear not to be updated---date says Feb 28

 

Why not just set up your own RSS and save in favourites, then you ll have from original filing

 

e.g. feed://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001056831&type=&dateb=&owner=exclude&count=40&output=atom

 

I spent a few minutes last night settting up several, for some of the funds recommended in one of the other threads (I think it was the "13F" thread)

[BargainValueHunter]

Credit:Onefamilysblog Dot Com

 

http://static.cdn-seekingalpha.com/uploads/2013/5/16/106657-13686797627314627-John-Vincent.jpg

[JRH]

Extract from an email I sent last week to a known blogger that was asking about Life Insurance in general and Genworth in particular.

 

Here are some comments on Genworth from a year ago. After the run-up, they look stupidly conservative but remember that at that time the world was going to collapse (once again) and there were plenty of cheap financials. Also, it's not much of a life company.

http://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/gnw-genworth-financial/msg82841/#msg82841

 

From last year, I would say the thing that changed the most is that the regulator concerns are much less of an issue now. It's very cheap but still a crappy business. I would guess, considering the similar position sizing to the warrants, that he likes the upside but sees some small probability of catastrophe.

 

I would call the comments "prudent", not "stupidly conservative", but that's just me...  ;D  A friend made a LOT of money on Genworth from the lows, good for him.  I never bought because I assumed the possible outcomes were bimodal, as you mentioned. 

 

I consider myself a "reversion to the mean" investor, so even a mediocre business with a low price/book might be worth another look if they are de-risking.

 

Thanks!

[fareastwarriors]

http://www.fairholmefunds.com/reports

 

new reports for the fairholme, allocation, and income funds.

[BargainValueHunter]

http://blogs.barrons.com/focusonfunds/2013/08/19/fairholme-fund-reopens-to-new-investors-should-you-buy-in/

 

This fund was at the top spot in the Barron’s ranking of “active share” early this year — that’s a measure of how far a mutual fund diverges from its benchmark. Being #1 means Fairholme was the likeliest of all large-cap mutual funds to either blow away its benchmark, or trail it badly.

 

It’s done both, as it happens, in the past two years: The fund slumped 32% in 2011 when the S&P total return was slightly positive; then it surged nearly 36% last year, more than doubling the benchmark. This year it’s slightly ahead of the S&P 500, 19.3% to 17.7%, according to Morningstar.

 

It’s all too much for S&P Capital IQ’s fund analysts. “We think the fund’s previously strong track record has been tarnished by a horrendous 2011 and we believe the fund incurs elevated risk through its holdings,” write S&P Todd Rosenbluth and Geoffrey Mrema.

[muscleman]

http://www.sec.gov/Archives/edgar/data/1056831/000105683113000004/xslForm13F_X01/13fFCM63013Submission.xml

 

From the latest 13F, how come I didn't see any Freddie/Fannie preferred? Does the 13F require him to file for the preferred?

[John Hjorth]

Muscleman,

 

If the preferreds are mentioned in the list for second quarter: http://www.sec.gov/divisions/investment/13flists.htm , otherwise not.

[muscleman]

Muscleman,

 

If the preferreds are mentioned in the list for second quarter: http://www.sec.gov/divisions/investment/13flists.htm , otherwise not.

 

Then how did people know that he bought those preferreds? If he didn't say it, people won't know, right? Also there are a few preferreds. I am wondering which is the one that he bought, though I think it probably makes sense to just buy the most liquid ones.

 

 

[valuecfa]

http://www.sec.gov/Archives/edgar/data/1096344/000119312513326872/d540362dncsrs.htm

 

Muscleman,

 

If the preferreds are mentioned in the list for second quarter: http://www.sec.gov/divisions/investment/13flists.htm , otherwise not.

 

Then how did people know that he bought those preferreds? If he didn't say it, people won't know, right? Also there are a few preferreds. I am wondering which is the one that he bought, though I think it probably makes sense to just buy the most liquid ones.

[muscleman]

http://www.sec.gov/Archives/edgar/data/1096344/000119312513326872/d540362dncsrs.htm

 

Muscleman,

 

If the preferreds are mentioned in the list for second quarter: http://www.sec.gov/divisions/investment/13flists.htm , otherwise not.

 

Then how did people know that he bought those preferreds? If he didn't say it, people won't know, right? Also there are a few preferreds. I am wondering which is the one that he bought, though I think it probably makes sense to just buy the most liquid ones.

 

Thanks a lot! Any way to know his cost basis?

[John Hjorth]

If the link from valuefca does not provide the wanted information, my best guess is: No.

[valuecfa]

http://www.sec.gov/Archives/edgar/data/1096344/000119312513326872/d540362dncsrs.htm

 

Muscleman,

 

If the preferreds are mentioned in the list for second quarter: http://www.sec.gov/divisions/investment/13flists.htm , otherwise not.

 

Then how did people know that he bought those preferreds? If he didn't say it, people won't know, right? Also there are a few preferreds. I am wondering which is the one that he bought, though I think it probably makes sense to just buy the most liquid ones.

 

Thanks a lot! Any way to know his cost basis?

 

Just looking at one series of one fund, and it looks like he bought at ~5-10% cheaper than the current prices on the preferreds

[muscleman]

http://www.sec.gov/Archives/edgar/data/1096344/000119312513326872/d540362dncsrs.htm

 

Muscleman,

 

If the preferreds are mentioned in the list for second quarter: http://www.sec.gov/divisions/investment/13flists.htm , otherwise not.

 

Then how did people know that he bought those preferreds? If he didn't say it, people won't know, right? Also there are a few preferreds. I am wondering which is the one that he bought, though I think it probably makes sense to just buy the most liquid ones.

 

Thanks a lot! Any way to know his cost basis?

 

Just looking at one series of one fund, and it looks like he bought at ~5-10% cheaper than the current prices on the preferreds

 

In the link, it said "value". I am wondering if this is mark to market value, or it is his cost basis? If it is his cost basis, I am a bit surprised that he missed all the $1-$5 run up and bought almost at the top.

[fareastwarriors]

http://www.sec.gov/Archives/edgar/data/1096344/000119312513326872/d540362dncsrs.htm

 

Muscleman,

 

If the preferreds are mentioned in the list for second quarter: http://www.sec.gov/divisions/investment/13flists.htm , otherwise not.

 

Then how did people know that he bought those preferreds? If he didn't say it, people won't know, right? Also there are a few preferreds. I am wondering which is the one that he bought, though I think it probably makes sense to just buy the most liquid ones.

 

Thanks a lot! Any way to know his cost basis?

 

Just looking at one series of one fund, and it looks like he bought at ~5-10% cheaper than the current prices on the preferreds

 

In the link, it said "value". I am wondering if this is mark to market value, or it is his cost basis? If it is his cost basis, I am a bit surprised that he missed all the $1-$5 run up and bought almost at the top.

 

 

"Value" should be # of shares held at period end times market closing price at period end.

[fareastwarriors]

http://video.cnbc.com/gallery/?play=1&video=3000196230

 

Bruce on CNBC

[Grenville]

http://video.cnbc.com/gallery/?play=1&video=3000196230

 

Bruce on CNBC

 

nice interview, thanks for posting!

[Guest hellsten]

Thanks.

 

I still have my mini-berkshire hathaway model working on Sears. I haven't been able to disprove that theory yet.

…

We spend our lives understanding the real estate structures, the ownership structure, the leasing structure.

[wescobrk]

I like Bruce but the mini Berkshire statement doesn't make any sense to me.

From 65-75 Buffett bought some insurance companies and made a fortune buying marketable securities for Berkshire in its first 10 years.

Eddie has had 10 years and he hasn't bought companies he has divested, furthermore he has lost money for shareholders buying marketable securities.

[Kraven]

I like Berkowitz a lot as well and love his conviction on his ideas.  That being said, he sometimes lets the story on things take over.  One thing that caught my attention in terms of AIG is that when asked what he would do with it since it's about 50% of the fund, he replied that Graham had the same problem with GEICO and that since it was so undervalued he wouldn't sell it, but instead distributed it to his holders.  It may have been true that he thought it was undervalued, but he distributed the shares because he had to as a result of securities regulatory issue related to fund ownership of insurance companies. 

[cogitator99]

Does anyone think its significant that FAIRX is opening at this point, after having been closed for only a short period of time?

 

My initial thought was he has a massive new investment idea and would appreciate the capital to make a large investment. It may be  the FNMA/FMCC prefs, or perhaps even something else.

 

Any thoughts?