twacowfca Posted January 8, 2013 Share Posted January 8, 2013 Give you an example...my personal portfolio was up over 125% in 2012...all BAC! MPIC Fund I, LP and MPIC Canadian LP did better than one tenth of that, because most of our partners would leave if I put everything into one stock! ;D Cheers! Nicely done. No leverage either. The day I was buying equity for the funds, I was buying equity only for my personal account. Never bought more again for any of them, as the price never hit our bid and BAC has risen ever since! I've done this three times before...BRKB's in 1999/2000, FFH, SNS and now BAC...I'm looking forward to the fifth time whenever that appears! ;D Cheers! Sanjeev, Looks like you may have bought at the same time we did( the day after BAC closed below $5.00) with our unfortunately micro sized position. Congratulations for going all in at just the right time. Awesome! Link to comment Share on other sites More sharing options...
Parsad Posted January 8, 2013 Share Posted January 8, 2013 Give you an example...my personal portfolio was up over 125% in 2012...all BAC! MPIC Fund I, LP and MPIC Canadian LP did better than one tenth of that, because most of our partners would leave if I put everything into one stock! ;D Cheers! Nicely done. No leverage either. The day I was buying equity for the funds, I was buying equity only for my personal account. Never bought more again for any of them, as the price never hit our bid and BAC has risen ever since! I've done this three times before...BRKB's in 1999/2000, FFH, SNS and now BAC...I'm looking forward to the fifth time whenever that appears! ;D Cheers! Sanjeev, Looks like you may have bought at the same time we did( the day after BAC closed below $5.00) with our unfortunately micro sized position. Congratulations for going all in at just the right time. Awesome! Yup, pretty much at that time Tim. Unfortunately, we didn't get the lows, but pretty close! Funny, we never hit the very lows of BRKB, FFH or SNS...but always we were close to the bottom. Cheers! Link to comment Share on other sites More sharing options...
Parsad Posted January 8, 2013 Share Posted January 8, 2013 Congrats Sanjeev. Very impressive indeed! Would you mind sharing the split between your personal and managed funds? The personal funds are significantly smaller than managed funds, as the personal funds have been partly funding my livelihood since I started the managed funds. Cheers! Link to comment Share on other sites More sharing options...
returnonmycapital Posted January 8, 2013 Share Posted January 8, 2013 parsad, congrats on pa i don't quite understand, why don't you institute a lock up period etc etc so that you can implement some of the things that you do in your pa in your fund? hy If I mistake in my own portfolio, I live with it and no one can fire me. Even if I institute a lock-up, if I screw up with a big position, when that lock-up comes due...those partners will leave regardless. So, while I may be able to take a slightly bigger position than I currently do now (our max is 25% right now in a single idea), it won't really make a huge difference because I'll be inclined to still not go to 50% or better with other people's money. The obligation, if you are honest and ethical, is to do them no wrong. So you do no wrong because you want to be able to live with the worst case decision. To put it as simply as I can...I would feel ten times worse losing someone else's money than my own! Alot of people don't feel that way. Cheers! You could always have a separate public fund that is more concentrated -- Berkowitz does something like that. You could claim it's your "single best idea" fund and that it would be concentrated in a single stock. This puts it up to your fund's investors to decide if they are comfortable putting a sizable amount into just one position. Takes all of the pressure off of you -- the ball is in their court to appropriately manage their exposure. I guess the time will come when I'll put some money into the funds of a few different managers and I'd actually prefer if they offered something like that. I feel like I'd rather get the best out of each manager, and spread the risk by putting money with more managers. Good idea, why haven't you done it? I suspect you wouldn't have too much trouble finding partners. Heck, my fund might even be interested (I don't have a PA). Link to comment Share on other sites More sharing options...
ragu Posted January 9, 2013 Share Posted January 9, 2013 I responded a bit about this above, but to answer directly, I was much more confident about Apple/Cirrus in 2010/2011 when I was buying. At this point, Cirrus has gotten a ton of surface area, so I'm not sure they can expand within Apple that much, and I'm less confident on Apple's future than I was (though I'm not a bear on them). Thus, imo, the growth over the next 2-3 years is essentially just Apple growth and I could buy Apple at a similar price at this point--however, I do really like the company and what they are doing in other areas (e.g., LED and motor control). racemize, Thanks for the response. Some comments: a. "Growing" is a dangerous word in the investment business that is mostly used to justify high(er) prices. The very fact that business has grown revenues/profits by x% in the most recent quarter (year) is not meaningful in and of itself. b. Unless you have evidence that suggests that earnings are temporarily depressed, multiples based on a single year of earnings will highly likely overstate true business value for the vast majority of businesses. A conservative stance dictates the usage of normalized earnings. c. While qualitative business analysis is important, the numbers have to make sense. Especially so for a 30% position. From your comments, I don't see a number that clearly stands out and reflects underlying value. I don't mean to criticize. My comments are in response to your request for feedback. Best, Ragu Link to comment Share on other sites More sharing options...
racemize Posted January 9, 2013 Author Share Posted January 9, 2013 Hi Ragu, thanks for your comments. I agree with your skepticism with respect to growth, however in this case, I had done enough homework to justify my assumptions, at least according to my own standards. The portions in the letter and my comments here are just the tip of the iceberg, as you can imagine (e.g., compare bac portion to the thread on the board). In any event, it was clear to me that the company had a very high chance of significant growth going forward, and at P/Es of 10-13, I would likely get at least get the underlying earnings growth and, given the huge swings in multiples, I might also expect to get higher multiples going forward. This, combined with the understanding of their management and culture made me confident in my decision. Link to comment Share on other sites More sharing options...
ragu Posted January 9, 2013 Share Posted January 9, 2013 The portions in the letter and my comments here are just the tip of the iceberg, as you can imagine (e.g., compare bac portion to the thread on the board). racemize, I imagined as much. I didn't mean to doubt your homework, just suggesting a few potential pitfalls (of which you were likely well aware). I suppose it comes down to a difference in approach. As Charlie reminds us: There is more than one way to investing heaven. Good luck! Best, Ragu Link to comment Share on other sites More sharing options...
Recommended Posts
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!
Register a new accountSign in
Already have an account? Sign in here.
Sign In Now