Packer16 Posted October 3, 2014 Share Posted October 3, 2014 In terms of comp ratios, I haven't run across a definitive guide but 5 Rules for Successful Stock Investing by Pat Dorsey and industry analyst reports can provide some guidance. I think as you study an industry you can pick pretty quickly what metric is used as it used quite often by analysts and others in the industry. As to size and outperformance, I think once get over a few billion for US equities it gets pretty hard. There are some exceptions in some industries today like some autos and financials but for the most part I think the large and mid-cap space is pretty efficient in the US. Look at firms like Longleaf and Sequoia (with great processes) and compare them to value indicies and you will see the outperformance if it exists is small. I think a "lazy portfolio" of small value tilted securities will probably capture most of the premium offered by value types of stocks. Packer Link to comment Share on other sites More sharing options...
tede02 Posted October 3, 2014 Share Posted October 3, 2014 Packer, my question is......... are you happy to see your team pummel the Vikings this evening? ;D I'm in the MNPLS area and have the game on. Your welcome for playing against Christian Ponder. ;) Couldn't help myself seeing this thread. Best, Ted Link to comment Share on other sites More sharing options...
Packer16 Posted October 3, 2014 Share Posted October 3, 2014 I am glad the Packers won and will take any win in this competitive season but it will be interesting to see how they can play against the Vikings starter QB. That in my mind will be the real test. Packer Link to comment Share on other sites More sharing options...
KCLarkin Posted October 3, 2014 Share Posted October 3, 2014 Look at firms like Longleaf and Sequoia (with great processes) and compare them to value indicies and you will see the outperformance if it exists is small. This probably has more to do with institutional constraints than market efficiency. Link to comment Share on other sites More sharing options...
fareastwarriors Posted October 3, 2014 Share Posted October 3, 2014 Look at firms like Longleaf and Sequoia (with great processes) and compare them to value indicies and you will see the outperformance if it exists is small. This probably has more to do with institutional constraints than market efficiency. Sequoia has a 1% drag due to management fee too. That additional 1% is very difficult to overcome... Link to comment Share on other sites More sharing options...
KCLarkin Posted October 3, 2014 Share Posted October 3, 2014 Sequoia has a 1% drag due to management fee too. That additional 1% is very difficult to overcome... Plus 15-20% cash for the last 6 years. Link to comment Share on other sites More sharing options...
frommi Posted October 15, 2014 Share Posted October 15, 2014 Packer can you help me and look into http://www.cornerofberkshireandfairfax.ca/forum/general-discussion/fcfp-vs-fcfev/msg193224/?topicseen#msg193224 and help me? Thanks in advance! Link to comment Share on other sites More sharing options...
west Posted October 25, 2014 Share Posted October 25, 2014 Packer, earlier in this thread you said: I don't read industry magazines but do track news associated with these firms and read in-depth industry and company specific research reports to put the valuations in a frame of reference. I recently got access to more professional research data like CapitalIQ, Bloomberg, etc. Is this where you get your industry research reports from? Are those reports just the "Primers" that I've seen floating around the web? Thanks in advance for your help! I swear I'll stop asking all these questions one day ;D Link to comment Share on other sites More sharing options...
Packer16 Posted October 26, 2014 Share Posted October 26, 2014 Bloomberg itself tracks alot of industry data and there are many analyst reports available also which can provide background. Bloomberg also has a function RV which provides comparison to comparable firms. Packer Link to comment Share on other sites More sharing options...
Laxputs Posted November 5, 2014 Share Posted November 5, 2014 May I ask what your current portfolio holdings are? Or your top 10 positions which are not so illiquid you are still trying to build positions in? TIA. Link to comment Share on other sites More sharing options...
Packer16 Posted November 6, 2014 Share Posted November 6, 2014 Not much has changed. I purchased some more Intralot at about Euro 1.25. Packer Link to comment Share on other sites More sharing options...
argonaut Posted November 6, 2014 Share Posted November 6, 2014 Can I ask as you avg down if you have a rule of thumb .. Eg for each 30% drop you avg 50% more of the original holding? Eg how much in percent more did you pick up at 1.25? Link to comment Share on other sites More sharing options...
Packer16 Posted November 6, 2014 Share Posted November 6, 2014 I don't have a rule per se other than seeing if for some reason the value has declined, which in this case it did not. I bought too much at the higher prices so this at least reduced my cost basis. In this case I bought about 33% of the original purchase price in value. Packer Link to comment Share on other sites More sharing options...
Guest JoelS Posted November 16, 2014 Share Posted November 16, 2014 Packer, do you categorize holdings or actively look for "work outs" or have you ever been in a "control situation". If not, is this something you might consider doing in the future? One further qs if I may, what methods, if any, have you found to reduce volatility in the down years, without compromising upside? Thank you in advance for any answers and thank you for this thread. Joel Link to comment Share on other sites More sharing options...
investor-man Posted November 16, 2014 Share Posted November 16, 2014 Hi Packer, Thanks again for taking the time to answer all of these questions! I met you in NYC a few months back and we were discussing your use of the Kelly Formula to choose a maximum on the size of a position. You said you always use 50/50 as your probabilities. I'm curious if you ever adjust those probabilities if your conviction goes up. For example, right now in my portfolio Fiat is approaching it's max based on a 50/50 probability with the Kelly formula -- Kelly tells me 20% at the current price/FV. But my conviction has gone up a bit, and if I adjust to 60/40, Kelly tells me to let it run up to 32%. Either way for tax purposes I'm going to keep all of my holdings in Fiat around for at least the next four months, but I'm curious what you do in situations like this. Thanks, investor-man Link to comment Share on other sites More sharing options...
Packer16 Posted November 16, 2014 Share Posted November 16, 2014 I haven't invested in many workouts as I don't feel I have any particular advantage over others here. I am planning on investing in NNN property funds to reduce my volatility going forward. Today you get a 7% yield plus rent appreciation of 2% with another 1% for accretive purchases. For the Kelly formula, I don't adjust the probabilities as I am looking for an objective percentage allocation. I use this as a warning sign (a risk control tool) when my portfolio is getting too concentrated. If you can withstand the volatility, you will be OK. You may also want to see if there are other investments that have similar upside that you can purchase with a partial sale of the position. I have done this within the past 12 months with AIQ and GNCMA when they have become larger parts of the portfolio. Packer Link to comment Share on other sites More sharing options...
WeiChiLoh Posted November 18, 2014 Share Posted November 18, 2014 Hi Packer, What do you think of this idea of mine? https://www.dropbox.com/s/tgbzuvpw7qnvi4x/Haw%20Par.pdf?dl=0 I am still learning, but I am hoping if I can get some feedback from a veteran. Thanks! Link to comment Share on other sites More sharing options...
west Posted November 21, 2014 Share Posted November 21, 2014 Packer, where do you generally get comparable transaction multiples from? I recently got access to CapitalIQ and I've used it for finding some transaction multiples. However, I've noticed it doesn't have everything. For example, Versar (a company I'm invested in) recently bought the firm J.M. Waller. All of the details for the transaction were very publicly disclosed. However, it's not in the CapitalIQ database as far as I see. Is there another (better?) resource you use to find these multiples? If not, how do you compensate for CapitalIQs lack of complete information? TIA. Link to comment Share on other sites More sharing options...
Packer16 Posted November 22, 2014 Share Posted November 22, 2014 I use Cap IQ and Bloomberg as a starting point and confirm/correct add to the data with financial disclosures and press releases. There can be implicit assumptions in Cap IQ data I have used in the past. Packer Link to comment Share on other sites More sharing options...
west Posted November 22, 2014 Share Posted November 22, 2014 I use Cap IQ and Bloomberg as a starting point and confirm/correct add to the data with financial disclosures and press releases. There can be implicit assumptions in Cap IQ data I have used in the past. Packer Huh. I didn't know Bloomberg had a way of looking at prior transactions. Is there an easy, um... I think you call it a Bloomberg command to access this? Or is it more complicated than that? Link to comment Share on other sites More sharing options...
Packer16 Posted November 22, 2014 Share Posted November 22, 2014 On Bloomberg find the subject company then use the CACS command and you should get a screen with a comps tab that includes related transactions. Packer Link to comment Share on other sites More sharing options...
usdtor05 Posted November 24, 2014 Share Posted November 24, 2014 Hi Packer, I have been struggling with something for a long time and wondering if you could help me out. I am assuming Sprint is going to be pushing pricing down heavily and fighting with a very cheap unlimited plan. My question is can Verizon, AT&T, T-Mobile compete on the data side with their spectrum (understand the auction just took place and could change this). I am still on Verizon because I always felt Sprint was crappy but to the extent they get their network in ok shape and offer a very cheap unlimited plan, that starts to be interesting. I think they have been pretty explicit in saying that they are going to compete on price/unlimited data but I can't wrap my head around if with their networks, the other guys could come down and fight them with a similar (maybe slightly more expensive plan given their better networks) plan but also unlimited data. Seems like we are moving towards more and more data and therefore Verizon plans would just get more expensive..I know mine has. Appreciate your thoughts in advance here. Link to comment Share on other sites More sharing options...
Packer16 Posted November 27, 2014 Share Posted November 27, 2014 I am not sure if I can add more than what you have already stated but when I switched from an unlimited data plan to a Verizon metered plan, I actually saved money. I think it depends upon what you do with the phone. I just surf the web so it doesn't take up to much bandwidth. If you are streaming Netflix, it is a different story. What may happen is the bandwidth heavy users go to Sprint and Verizon is left with low and moderate bandwidth folks. I am not sure how many folks are low/moderate users like me vs. the heavy users and how that changes over time. If the low/high ratio is low and stays low than Verizon should do well, however, if Sprint gets these cost conscience high bandwidth it may not be the best situation for them. Sprint will have an advantage if there is spike in the high bandwidth users without a corresponding increase in bandwith which is the opposite of what has happened in the past, for most users bandwidth has always ran ahead of use. Packer Link to comment Share on other sites More sharing options...
Liberty Posted November 27, 2014 Share Posted November 27, 2014 Hi Packer, Apologies if you have already written about this topic (I haven't seen it). I was curious to know if you were looking at the upcoming tracking stock by Liberty Global for their Latin America assets? There aren't many details yet so it's too early to value, but I'm curious to know if you have an opinion on the cable industry in the area and whether it's a good environment to rerun the TCI playbook (for the third time) and consolidate the industry there. Thank you. Link to comment Share on other sites More sharing options...
cameronfen Posted December 12, 2014 Share Posted December 12, 2014 Hi Packer, I think it has been mentioned that you are long Asia Standard and Shun Ho Resources. Why are you long Shun Ho Resources and not Shun Ho Technology? I think the P/E on Technology is lower. Thanks, Cameron Link to comment Share on other sites More sharing options...
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