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What are you buying today?


LowIQinvestor

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Guest longinvestor

Finally started a personal portfolio outside the 401k.  SBLK at @ 8.32 a few weeks ago.  Pretty conservative industry with large moats if I say so myself.  :o

 

I'm kind of confused or did i misunderstand what you meant by the below statement in the SBLK thread?

 

Does anyone make money besides management in these damn companies? I'm an idiot and will gladly run the company into the ground if you gave me the chance -- especially while getting PAID.

 

To clarify I think the industry is very competitive and there is little moat if any -- I was being sarcastic.

 

Also I looked up when I purchased SBLK and it was May 24th.  Less than a month later I am complaining on a message board...  My underlying reason to buy never changed so I never sold.  I like having the message board records to hold myself accountable and observe the absurdity of my emotional spectrum.  It's a self experiment that may be short lived -- worst case I pay for a life lesson and just invest in Berkshire and find a new hobby.

 

You have my company in this. I have also gone back some years to check on my posts. Hoping to see that I'm less of an idiot over time, there's still plenty of emotional baggage to get rid of.

 

The subject of emotions in investing is well under represented on this message board. Or at least overwhelmed by the quantitative stuff. It is one thing to hear Munger talk about it, yet another for us mere mortals share our experiences. It is quite hard as you seem to be aware, checking on yourself.

 

Please keep sharing your thoughts. 

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More SVA. Might write a little bit about it later. Chinese going private at a ~5% discount to $7 offer, third party offering $8.

 

Thanks again for another interesting idea, wrister. It seems that the market has not really responded to the third party offering news yet?? I had to search for a while to dig it up:

http://www.prnewswire.com/news-releases/to-fight-against-the-behavior-between-sinovacs-special-committee-and-weidong-yins-consortium-and-their-low-price-sinobioway-consortium-raises-its-purchase-price-to-8-per-share-300481381.html

 

 

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Yeah, the competing group of bidders include a $2B USD pharma company, they should be able to finance this deal. Whether the SVA board allows them to do so is a different question .. I was lucky enough to buy some shares the past few days around $6.35 as I thought it was an attractive deal even without the second bid. Still looks attractive even if you assign only a small chance to the $8 bid succeeding.

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Yeah, the competing group of bidders include a $2B USD pharma company, they should be able to finance this deal. Whether the SVA board allows them to do so is a different question .. I was lucky enough to buy some shares the past few days around $6.35 as I thought it was an attractive deal even without the second bid. Still looks attractive even if you assign only a small chance to the $8 bid succeeding.

 

Agreed, seems like a free option play.

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  • 2 weeks later...

Bought more Citi today

 

To me, a good deed.

 

I think that financial still have some upside. However, one thing that keeps bothering me is that I don't know how these big banks will do with a) online/mobile payments and b) cyber currency. Does that mostly eliminate the need to go to a branch, which is a big moat for the big banks? How will that impair their earnings?

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Bought more Citi today

 

To me, a good deed.

 

I think that financial still have some upside. However, one thing that keeps bothering me is that I don't know how these big banks will do with a) online/mobile payments and b) cyber currency. Does that mostly eliminate the need to go to a branch, which is a big moat for the big banks? How will that impair their earnings?

 

You should look at Ally, the largest online bank and growing deposits at 20% per year, most of it from millenials. Overhead is lower since they don't have any branches (lower efficiency ratio too vs. money centers) and they pass a lot of these savings to customers by offering higher rates. Trading a 9X earnings and 0.7X B/V buying back a lot of shares.. market is concerned with Auto loan exposure but after looking at their loan book which is mostly prime (and they're diversifying through mortgages, credit cards and online brokerage) I'm fine owning it

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Generally over the past few weeks:

 

1) EM: Significantly increased my stake in PEFIX as re-balancing has led the portfolio of companies to be even cheaper on P/B, P/E, and P/S basis than it had before it's 50+% rally in 2016. Reduced European equity exposure to do so.

 

2) U.S. retail: Sold puts on LB and SHLD and re-investing dividends into RL and UA. Looking at other names as they get cheaper and may add SRG to the mix. Closed my position in the 25+ year zero coupon bond fund with gains of ~10% to fund put sales. I am not confident that we'll hit new lows outside of a recession, but think there will be other opportunities to re-enter of the next 1-3 years.

 

3) Resources: Adding to ALS and PDER. Looking to add to Lukoil if prices remain weak.

 

 

 

 

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Interesting.  Gundlach scared me about derivatives used in Pimco funds in one of his talks and I switched from PEFIX to FNDE.  But it hasn't quite been hanging with the performance (neither has PXH over 5 years).  But I guess that was to be expected with losing the "plus"/leverage.

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Interesting.  Gundlach scared me about derivatives used in Pimco funds in one of his talks and I switched from PEFIX to FNDE.  But it hasn't quite been hanging with the performance (neither has PXH over 5 years).  But I guess that was to be expected with losing the "plus"/leverage.

 

Yea, the PIMCO StocksPlus and StocksPlus Long Duration funds are two of the best performing "active" equity funds in the mutual fund universe since their inceptions. The standard StocksPlus fund goes back to the 80s so it's a LONG track record of implementing the strategy successfully without blowing up in the U.S. markets.

 

There's definitely increased risk with the use of economic leverage and EM is far more volatile, but I'm relatively confident in their ability to manage it responsibly given their long-term success in the U.S. Plus, they're not swinging for the fences with the collateral - current duration is less than a year it's diversified across U.S. treasuries, mortgages, and corporate exposures. They simply have to beat the funding cost of the swaps used (LIBOR plus a spread) with the fixed income portfolio so it doesn't have to be anything TOO crazy to get the additional 2-3% a year.

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Interesting.  Gundlach scared me about derivatives used in Pimco funds in one of his talks and I switched from PEFIX to FNDE.  But it hasn't quite been hanging with the performance (neither has PXH over 5 years).  But I guess that was to be expected with losing the "plus"/leverage.

 

Yea, the PIMCO StocksPlus and StocksPlus Long Duration funds are two of the best performing "active" equity funds in the mutual fund universe since their inceptions. The standard StocksPlus fund goes back to the 80s so it's a LONG track record of implementing the strategy successfully without blowing up in the U.S. markets.

 

There's definitely increased risk with the use of economic leverage and EM is far more volatile, but I'm relatively confident in their ability to manage it responsibly given their long-term success in the U.S. Plus, they're not swinging for the fences with the collateral - current duration is less than a year it's diversified across U.S. treasuries, mortgages, and corporate exposures. They simply have to beat the funding cost of the swaps used (LIBOR plus a spread) with the fixed income portfolio so it doesn't have to be anything TOO crazy to get the additional 2-3% a year.

 

Interesting.  Thanks for the response.  Clarification, I had the retail fund not PEFIX.    ;D

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