Chou vs Berkowitz

[berkshiremystery]

At least they are both in the top 10 this quarter, even if a rational investor shouldn't care about quarterly numbers. I enjoy their comeback  ;D

 

Best Hedge Funds: First Quarter 2012

http://www.insidermonkey.com/blog/2012/04/04/best-hedge-funds-first-quarter-2012/

http://seekingalpha.com/article/484591-top-stock-picks-of-best-performing-hedge-fund-managers?source=yahoo

 

 

2. Fairholme – Bruce Berkowitz: Bruce Berkowitz is showing investors (and John Paulson) that investing is a marathon. After last year’s terrible performance, his 16 stock picks returned 38.2% during the first quarter.

 

4. ESL Investments – Eddie Lampert: Lampert’s top picks pulled back a little bit since we last compiled the list of best hedge funds. However his  8 large-cap stock picks returned 36.9% during the first quarter.

 

8. Chou Associates Management: Francis Chou managed to find 17 large-cap stocks that can deliver a 31.9% return in the first three months of 2012.

 

 

 

 

 

 

 

[Parsad]

At least they are both in the top 10 this quarter, even if a rational investor shouldn't care about quarterly numbers. I enjoy their comeback  ;D

 

Best Hedge Funds: First Quarter 2012

http://www.insidermonkey.com/blog/2012/04/04/best-hedge-funds-first-quarter-2012/

http://seekingalpha.com/article/484591-top-stock-picks-of-best-performing-hedge-fund-managers?source=yahoo

 

 

2. Fairholme – Bruce Berkowitz: Bruce Berkowitz is showing investors (and John Paulson) that investing is a marathon. After last year’s terrible performance, his 16 stock picks returned 38.2% during the first quarter.

 

4. ESL Investments – Eddie Lampert: Lampert’s top picks pulled back a little bit since we last compiled the list of best hedge funds. However his  8 large-cap stock picks returned 36.9% during the first quarter.

 

8. Chou Associates Management: Francis Chou managed to find 17 large-cap stocks that can deliver a 31.9% return in the first three months of 2012.

 

Those three didn't suddenly become stupid!  ;D  You knew they would always rebound.  Cheers!

[BargainValueHunter]

At least they are both in the top 10 this quarter, even if a rational investor shouldn't care about quarterly numbers. I enjoy their comeback  ;D

 

Best Hedge Funds: First Quarter 2012

http://www.insidermonkey.com/blog/2012/04/04/best-hedge-funds-first-quarter-2012/

http://seekingalpha.com/article/484591-top-stock-picks-of-best-performing-hedge-fund-managers?source=yahoo

 

 

2. Fairholme – Bruce Berkowitz: Bruce Berkowitz is showing investors (and John Paulson) that investing is a marathon. After last year’s terrible performance, his 16 stock picks returned 38.2% during the first quarter.

 

4. ESL Investments – Eddie Lampert: Lampert’s top picks pulled back a little bit since we last compiled the list of best hedge funds. However his  8 large-cap stock picks returned 36.9% during the first quarter.

 

8. Chou Associates Management: Francis Chou managed to find 17 large-cap stocks that can deliver a 31.9% return in the first three months of 2012.

 

I think these guys are brilliant but I think the blowout Q1 was less about great stock picking last year and more about the stupid levels many of the financial stocks (especially BAC) got punished down to last fall.

 

The snapback coincidentally started almost exactly at the New Year (quarter).

 

Q4 2011 looked a bit like Q1 2009 to me.

[racemize]

I thought they would come back strong, but we still haven't gotten to the point where the investments last year have paid off (e.g., above water), at least for Berkowitz.  I was really hoping to get invested in the fund last August, but we could never get him to respond for being included in our 401k (sadface).

[BargainValueHunter]

2015 YTD Returns (through 12/3/15)

 

S&P 500: +1.59%

 

FAIRX: -6.64%

FAAFX: -12.43%

------------------

CHOEX: -20.42%

..............................

Income Fund Comparison

 

FOCIX: +1.06%

------------------

CHOIX: -13.72%

 

Both manager's equity funds have that SHLD wildcard :o

[mhdousa]

2015 YTD Returns (through 12/3/15)

 

S&P 500: +1.59%

 

FAIRX: -6.64%

FAAFX: -12.43%

------------------

CHOEX: -20.42%

..............................

Income Fund Comparison

 

FOCIX: +1.06%

------------------

CHOIX: -13.72%

 

Both manager's equity funds have that SHLD wildcard :o

 

And 11 months of returns are indicative of what?

[BargainValueHunter]

2015 YTD Returns (through 12/3/15)

 

S&P 500: +1.59%

 

FAIRX: -6.64%

FAAFX: -12.43%

------------------

CHOEX: -20.42%

..............................

Income Fund Comparison

 

FOCIX: +1.06%

------------------

CHOIX: -13.72%

 

Both manager's equity funds have that SHLD wildcard :o

 

And 11 months of returns are indicative of what?

Indicative of a snapshot. Same as [fill in any other arbitrary length of time].

[Jurgis]

If I did not have oil co positions, I'd be filled with hubris that my 11 month returns are better than theirs. Now, not so much.  8)

 

Peace.

[mhdousa]

2 contrarians.

 

The US vs Canadian mutual fund managers of the decade.

 

You have one to give your money to for the next 30 years (in their available open-end mutual fund vehicles).

 

Who do you pick and why?

 

This is a real exercise in that, while I personally manage my non-qualified account, I prefer to invest my retirement money with managers and am trying to decide between Fairholme and Chou America.

 

-M

 

In the 5 years since I first asked this question the Chou Opportunity fund returned 4% a year, and Fairholme returned 8% a year (7% if you take out the spike since the election). Both of them badly underperformed the indexes.

 

Shows you it's REALLY hard to pick active managers.

[Liberty]

In the 5 years since I first asked this question the Chou Opportunity fund returned 4% a year, and Fairholme returned 8% a year (7% if you take out the spike since the election). Both of them badly underperformed the indexes.

 

Shows you it's REALLY hard to pick active managers.

 

Indeed. Thanks for bumping this up, I think too often we never get to learn how things turn out.

 

I wish all the pundits making predictions were somehow tracked and their past predictions were periodically revisited to see how they turned out.

[stahleyp]

Liberty, probably not quite what you're looking for but might be useful.

 

https://www.cxoadvisory.com/gurus/

[investmd]

 

 

Francis is the kindest person I know in the financial industry, and that says alot because I know Prem, Mohnish and Tim McElvaine, and they are also some of the most generous people I know.  But Francis is unique...very unique!  If I were a captain in the investment industry, he is who you hire to be your right hand man.  His honesty is beyond reproach!  And he will never take credit for anything.  Has anyone ever heard from Francis that the CDS idea was his?  Nope!  You heard it from Brian Bradstreet.  We all know how talented the team is at Hamblin-Watsa, but all those principals there hold Francis in very high regard.  That should tell you something.  Everyone else can have Sprott, I'll take Francis.  Cheers!

 

Has the opinion changed over the past 5 years? 10 yr returns of 4% (Chou Associates), 5% (Chou Asia) and negative 0.5% (Chou Europe) may be acceptable if the philosophy is still sound. However, Chou has not given any insight as to why mistakes were made that lead to large losses, what he has learned and why it may be different going forward. The 2016 annual letter is disappointing when he explains results by saying one bad year can ruin your 5 or 10 year result. That doesn't cut it. There will always be negative years. However, over time they should be averaged out by great years.

Chou put in $80-90 million - approx 20% of assets of Chou Associates in Valeant Pharmaceuticals. The investment is down 70%. Would he put >20% of the fund into a future investment? take a similar risk? An explanation as to why or if he would do the same in the future with a different company or has learnt something to prevent massive losses would be honest. Admitting that 10 years is a fair time to judge an investor would be honest.

Overall, he has great individual company analysis and has the ability to pick stocks that have potential to triple or more but has not been able to ward off the huge losses - Buffett's first rule.

 

[OracleofCarolina]

Just glanced at the returns for Chou Opportunity and Fairholme...jeez...they are going to need some monster returns against the SP 500 in the future

[stahleyp]

I was just looking at Chou Associates on Morningstar.

 

From inception to 2000, the fund under-performed both the average "Global Equity" fund and MSCI World GR CAD. In fact, it trailed most of that time (having a brief spike in 1997/1998 or so where it brought its returns since inception over the bogey). From inception through today, though a $10,000 investment in the fund is worth around $198,700 vs $97,000 for global equity and $105,000 for MSCI. The last 10 years he's gotten killed, too. When investing with funds, are you ready to under-perform for 14 years or so? That's patience.

 

Now if you compare that to the S&P 500, the $10,000 invested would now be worth about $195,600. So he's outperformed while having high expenses (but only before taxes). I think after taxes the S&P500 would have been quite a bit more profitable.

 

 

 

 

[investmd]

I was just looking at Chou Associates on Morningstar.

 

From inception to 2000, the fund under-performed both the average "Global Equity" fund and MSCI World GR CAD. In fact, it trailed most of that time (having a brief spike in 1997/1998 or so where it brought its returns since inception over the bogey). From inception through today, though a $10,000 investment in the fund is worth around $198,700 vs $97,000 for global equity and $105,000 for MSCI. The last 10 years he's gotten killed, too. When investing with funds, are you ready to under-perform for 14 years or so? That's patience.

 

Now if you compare that to the S&P 500, the $10,000 invested would now be worth about $195,600. So he's outperformed while having high expenses (but only before taxes). I think after taxes the S&P500 would have been quite a bit more profitable.

 

In past periods of underperformance he has withheld his management fee - but has not done so lately. Will be interesting to see if he comments on his performance in his semi-annual letter - likely out in August. Recently, in his letters he seems defensive about his results without offering an academic explanation of 1)what happened & 2)what he has learned to prevent such outcomes.  In my view, it's unfortunate that he has taken a "that's just the way it is" approach to explaining his 10 year outcomes. It's sad because I think he has a lot to offer.