2008-03-31
Berkowitz Sees Volatility As An Opportunity
"Volatility equates to opportunity and not risk," said Bruce Berkowitz, one of the fund's FAIRX three managers. "Risk is the chance for a permanent loss. This is the kind of environment that Warren Buffett has been patiently awaiting for many years."
Direct Link - Berkowitz Sees Volatility As An Opportunity.
Betting Big, Winning Big: Interview With Bruce Berkowitz
Barron's: You run a very concentrated portfolio, with the top 10 holdings of the Fairholme Fund accounting for roughly 70% of the assets. Why is that?
Berkowitz: If you can buy more of your best idea, why put [the money] into your 10th-best idea or your 20th-best idea? If we're confident in what we do, then that's the way we should do it. The only reason not to is a fear of being wrong. The more positions you have, the more average you are.
How do you go about mitigating risk in such a concentrated portfolio?
We consider risk to be the chance of permanent loss, as opposed to volatility. Volatility is more of an opportunity. There's nothing better than a one-time event that allows you to buy a reasonable company at a great price. So we are looking at the chance -- in terms of risk -- of a permanent loss, based upon our own security research.
Direct Link - Betting Big, Winning Big.
Fairholme's Bruce Berkowitz discusses WellCare and Sears
Video Link - Fairholme's Bruce Berkowitz discusses WellCare and Sears.
How value investor Chou wins with bonds
Mr. Francis Chou’s method can be boiled down to a few principles. As he wrote in his 2007 report to unitholders, “the cardinal principle of investing is to think first about preserving capital before thinking about making money. The greater the probability of permanent loss of capital, the greater the spread should be between a particular debt instrument and risk-free treasuries.”
Direct Link - How value investor Chou wins with bonds.
Notes From A Conversation with Munger at Caltech in Pasadena
Charlie : I love Occum's Razor (Wikipedia). Einstein once said make everything as simple as possible, but not simpler. In the field of messy social sciences, use a variety of disciplines and look for a confluence of factors when dealing with "lollapaloozas". (significant and strange events, black swans)
For example, I was fascinated about what made people join Moonies, a cult-like group. It didn't make sense until I ran into Pavlov, who experimented on dogs by pushing them to nervous breakdowns (He did this by locking them in cages and then raising the water level up to mouth height, making them think they were about to drown) . Afterwards, they would act in the complete opposite fashion. This was very similar to one of the Moonies conversion methods: "causing the target to snap".
Direct Link - Notes From A Conversation with Munger.
Interview with Chris Davis and Ken Feinberg of The Davis Funds
- Buffett Practitioners at Work
- In part one , they talk some of the tenets of their investment philosophy as well as how they think about assessing management teams.
- Stock Picks from the Davis Funds
- In part two of my chat, we discuss their ideal time horizon as well as one of the stocks in my portfolio, and one on my watch list.
- Talk Insurance Stocks with the Davis Funds
- In part three of my chat with Chris Davis and Ken Feinberg of The Davis Funds, we discuss their thoughts on some elements of the current credit crunch, as well as their take on a couple of insurance stocks I've had on my watch list. Both AIG (the top stock on my watch list) and Progressive have delivered great returns for their shareholders over the last few decades, and now both have somewhat attractive valuations.
- The Davis Funds Team on the Credit Markets
- In part four, the final segment of my chat with Chris Davis and Ken Feinberg of The Davis Funds, we discuss their take on the credit markets, given their portfolio's large weighting in the financial-services sector. In addition, we also touch on two other investments: Sprint Nextel (S) and Canadian Natural Resources (CNQ).
2008-03-04
Warren Buffett Answers Your Emails on Squawk Box: Transcripts
- Full Transcript (PDF)
- Warren Buffett Answers Your Emails on Squawk Box: Transcript (Part 1)
- Warren Buffett Answers Your Emails on Squawk Box: Transcript (Part 2)
- Warren Buffett Answers Your Emails on Squawk Box: Transcript (Part 3)
- Warren Buffett Answers Your Emails on Squawk Box: Transcript (Part 4)
- Warren Buffett Answers Your Emails on Squawk Box: Transcript (Part 5)
- Warren Buffett Answers Your Emails on Squawk Box: Transcript (Part 6)
- Warren Buffett Answers Your Emails on Squawk Box: Transcript (Part 7)
- Warren Buffett Answers Your Emails on Squawk Box: Transcript (Part 8)
- Warren Buffett Answers Your Emails on Squawk Box: Transcript (Part 9)
- Warren Buffett Answers Your Emails on Squawk Box: Transcript (Part 10)
- Warren Buffett Answers Your Emails on Squawk Box: Transcript (Part 11 and Final)
Warren Buffett on CNBC's Squawk Box, 3-3-08
This is a live blog of Warren Buffett's appearance on CNBC's squawk box during the 6am et hour. Buffett is live at the Nebraska Furniture Mart (a Berkshire Hathaway subsidiary) in Omaha with our Becky quick to answer your email questions.
Related Links :
Buffett's Words of Wisdom - 2007 Annual Letter
Related Links :
- 2007 Annual Letter (PDF)
- Whitney Tilson on Buffett's annual letter
- Andrew Kilpatrick, a Warren Buffett biographer, and Robert Miles, author of "The Warren Buffett CEO," discuss the Sage of Omaha.
- Buffett's Bets - Mohnish Pabrai
- A take on Warren Buffett's famed investor letter, with Mark Hake, Hake Capital Mgmt.; Mohnish Pabrai, Pabrai Investment Funds; and CNBC's Maria Bartiromo.
Whitney Tilson's recent video clips , Feb. 2008
- Whitney Tilson on Fox Biz News, 2-22-08
- Whitney Tilson onTarget, Sears Holdings and Merrill's downgrade of Fannie Mae and Freddie Mac.
- Bottom Fishing for Retail Stocks
- Opportunities in retail, with Whitney Tilson, T2 Partners & Michael Farr, Farr, Miller & Washington.
- Whitney Tilson on 13-F filings, 2-13-08
- The Fast Money traders, along with Whitney Tilson, of T2 Capital Partners, look ahead to 13-F season.
- Whitney Tilson on retailers, Sears Holdings, 2-8-08
Video Conference with Walter J. Schloss, CFA
“Mr. Schloss started on Wall Street in 1934, at the age of 18, in the midst of the depression (working for Loeb Roades, then called Carl M. Loeb & Co). During the late 1930’s, Schloss took courses from Benjamin Graham at the New York Stock Exchange Institute. He was in good company. His fellow students included Gus Levy, head of the arbitrage department of Goldman Sachs; Cy Winters of Abraham, at one time president of the New York Society of Security Analysts; and other Wall Street heavyweights.
At the time Schloss was working at Carl M. Loeb and Company, Graham’s brother Leon was a customer’s man at the firm and Graham kept his account there, allowing Schloss to confirm that Graham did indeed practice what he preached in class. Graham hired Schloss in 1946 as soon as Walter was discharged from the service” (from “Value Investing” by Greenwald, Kahn, Sonkin and van Biema, 2001, p. 265). The rest is history.
Mr. Schloss started his limited partnership in the middle of 1955. In 1963, he earned the Chartered Financial Analyst designation. Waller’s son Edwin joined the partnership in 1973 and the fund changed its name to Walter & Edwin Schloss Associates. Over the period 1956 to 2000, Mr. Schloss and his son Edwin provided investors a compounded return of 15.3% compared with the S&P 500’s annual compounded return on 11.5%.
Video Link - Video Conference with Walter J. Schloss, CFA.
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