Jurgis

The problem with O&G is that even Peyto is forced to sell the product at low prices if the prices crash. I understand when Darren Gee argues that it is time to buy properties and invest when commodity prices is low. This is rational. But that's just one side of the coin. At the same time he is forced to sell the product for crappy prices. There is no option to dictate the price or not to take crappy prices (like Buffett does in insurance - not write losing business). Peyto will survive longer than other companies, but still if O&G prices run up, it would be a sell, since in next downturn the shares will drop (again). And BTW even with the argument "that it is time to buy properties and invest when commodity prices is low" Peyto dilution is nothing to be happy about. Anyway, this is not particularly criticism of Darren Gee. It's a criticism of the industry. Obligatory Buffett quote: "When a management with a reputation for brilliance tackles a business with a reputation for bad economics, it is the reputation of the business that remains intact."

I predict this thread will reach 100 pages. Unless my prediction kills it cold. In which case another similar thread will reach 100 pages. ;D

Hmm, OK. :) I'd look at it the following way. There are 3 different issues that may happen with investment: 1. Your process is flawed. 2. Your process is OK, but you deviate from it. 3. Your process is OK, but there's never 100% success rate and you get one of the failures. When I see someone saying "hindsight bias" about this thread, it seems that they are implying that #3 occurred but people think #1 happened (or vice versa?) In general, #2 should be easy to detect and avoid - but it isn't because of below. Distinguishing #3 and #1 is difficult for various reasons. People are not sure about their process. People don't have a precise definition about their process. Because of the same reasons, people deviate from the process without noticing it (#2) or notice it and rationalize it (still #2). Probably only #2 is a "mistake". #1 is a poor choice of process - although it perhaps could be called mistake with a stretch. #3 is not a mistake - it's an inevitable result of investing in unpredictable world. Going back to cloud (not picking on him personally, but just for illustration) - here's my analysis. Others might see it differently though, I don't claim I see the truth. He had a process. He deviated from the process by bad position sizing (#2). Then #3 occurred - KORS started dropping. He deviated from the process even more (#2 again). Now he thinks that his process was bad (#1) and he abandoned it. In reality his process may have been good (although I cannot say for sure), but he got sucked in by #2 and #3. Looking at myself (so we don't pick just on cloud ;)), I usually succumb to #2 (deviation from process), because I am not sure if my process is good (i.e. I am not sure if I'm in #1) and because some opportunities look very attractive even though they don't conform to the process (that's still #2!). Take care

How would you distinguish a real mistake from a hindsight bias? :)

Very few got JPM at $50. My Fido order filled at $58 I think.

I think valueinvesting101 is asking whether they can buy PCP stock on open market while they have offer for it pending. I think they can up to poison pill level (if any), but I'm not 100% sure. In some other countries, this is not allowed.

Right. I am not bitching that it's dropping either. I'll keep buying. I am trying to understand the short term moves, which is of course a no no. That's why I said "Feel free to ignore". :) I guess it's harder for you since you have a big position.

Jurgis, Jurgis, Jurgis. Now did I say I was an oracle? No I didn't Jurgis. That was a question. :) Thanks for answering it. :D

And NOV is still green for the day... ;)

As I said before, I have ~26% of cash. Which may be too much or too little depending on how things work out.

Feel free to ignore below. I find it interesting that BRK is so weak recently. It has already dropped quite a bit this year and it's underperforming in a crash too. It seems that people don't think BRK is a good hold for a downdraft and there's not much buying either. I wonder if this is due to the fact that they bought PCP and people think they don't have enough cash for buybacks or opportunistic investments in a market drop. Anyway, so far "BRK is cash equivalent" theory has been thoroughly discredited this year.

Depends on a stock. Some stocks are down 20+% this year. BRK is down >15%. Oil stocks are down... censored. Maybe it will, maybe it won't. Are you an oracle?

Looks like this would be a good strategy for some ETFs too? Might work. Some markets (and brokers?) don't allow limit orders >10% (20%? - can't find reference) below market price.

Good post ap1234. :)

Apollo 13 is one of the best movies ever.

Well, Icahn was somewhat right about ETFs.

I'd go with "I am funny and Gio is right", but unfortunately being right is reserved to my wife and she might not want to share this with you. ;) IMHO, FDA approval of Sprout is rather fishy, however, it is a call option for VRX more or less. The only risk above the price paid is if there are side effects and VRX gets sued for more money than they paid. IMHO AZ Value and other VRX bears raise some valid issues. I don't have much to add. Of course it is up to everyone to make their own mind and bulls might be right too. Disclosure: I do not have direct positions in VRX. I own small position in PSHZF.

I saw FDN down 20% after you mentioned it was down 40% and I did not buy it. I'm an idiot too. ;) Nah, these things require really fast fingers, great broker, fast thinking. ETF opportunities were real, but some other thinly traded stocks were not: they were down 10-15% with no volume so nothing really went through. So don't beat yourself. You got what you got, can't get them all, tomorrow's another day, etc. Peace.

Got crappy execution on BRKB, but good ones on JPM, AAPL. @tombgrt: Yeah, this might not be the end. I only spent ~2% of my portfolio buying today so far. Still got ~26% in cash. Missed your FDN down 40%. Edit: yeah, I got LMCA too.

JPM & AAPL orders went through, BRKB went through too. Was on hold with Fido at their high priority line for 20 minutes never got rep... Edit2: Fido website is working though after some glitches.

Everything. 8)

I think his point was that 1.2x P/BV might not be hard line in the sand below which stock won't drop. So it's not about valuing BRK, but rather possibly keeping some powder dry for prices below 1.2x P/BV if they don't stop decline via buybacks.

I agree with rb. Unlike deflation derivatives that might be for sale at the right price, I doubt that Prem will exit equity hedges if market drops even 20%. I hold FFH, but not because of their equity hedges. I am buying BRK. Most of the other stocks are still too expensive for my taste, including the ones mentioned by rb. There are pockets of cheapness, though some of them might be illusionary (oil cos for example).

Right, these are issues for India and China in terms of air quality (and for world in terms of pollution). OTOH that might not save US thermal coal companies.

Come on! It is simply amazing how people are willing to say the most stupid things just in order to defend VRX ... I understand success, extreme success!, might make lots of people emotionally attached to their stock... But, please... Show a little decency!?