On page 175 of Janet Lowe’s book, Damn Right! Behind The Scenes With Berkshire Hathaway Billionaire Charlie Munger, Ms. Lowe quotes Charlie as saying:
“People underrate the importance of a few simple big ideas. And I think to the extent that Berkshire Hathaway is a didactic enterprise teaching the right systems of thought, the chief lesson is that a few big ideas really work. I think these filters of ours have worked pretty well—because they are so simple.”
It’s Christmas time, and that’s as good a reason as any to engage in big-picture contemplative thinking about life. For a moment, let’s break down everything we do with our life into decision trees (Christmas tree edition).
Most of us, even we aren’t particularly materialistic about cars, houses, or clothing, recognize the use of money for the experiences that they are capable of creating. Super Bowl tickets. Hikes across Europe. Chilling … Read the rest of this article!
Back in 2011, Barry Schneider launched Loyal3 for the purpose of allowing the mom-and-pop small investor to have a chance to invest alongside institutional Wall Street investors in initial public offerings.
Perhaps most popular of all, Loyal3 enabled investors with as little as $10 to invest in the initial public offering for Square (SQ) on November 19, 2015. Oddly enough, the price of Square’s IPO was $10, meaning investors with minimal investment funds could access a stock that now trades at $75 per share just four years later.
The IPO investing opportunities that Loyal3 provided, for no fee on the investor end, was absolutely unparalleled.
Of course, there were only a five or six IPOs, at most, that could capture an investor’s attention over the course of a year, and to build an ongoing business model outside of these one-time events, Schneider entered into relationships with approximately 75 publicly traded … Read the rest of this article!
When I receive e-mails from people who have come across this blog and want to discuss portfolio strategy, I’ve found that a good chunk of readers have taken to a dividend growth strategy even if they would not articulate it as such.
The impetus for writing this article came from a reader who said (in my paraphrase), “Yeah, I’ve held Coca-Cola, Johnson & Johnson, and Colgate stock which you talk about a lot. I’ve had it since 1992. I didn’t really see the point in selling it because the dividend kept going up.”
Once you have one of the top businesses in the world on your household balance sheet, it doesn’t really make a whole lot of sense to sell it. A well-picked dividend stock is like your own little money well, your own little cheat that makes life easier, your own little ATM machine that dispenses money four times … Read the rest of this article!
There is a company, founded in 1889, with a long track record of rewarding its shareholders, that is now trading at a P/E ratio below its historical norms while it is primed to grow earnings per share at 13-16% over the medium term because certain risks are coming off of its balance sheet and other assets under its umbrella are about to become much more valuable. My own view is that 13-16% earnings per share growth will mix with P/E ratio expansion to deliver 15-20% annual returns over the medium term, far outpacing the returns generated by index fund investors in the S&P 500 in general.
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In 1982, Jack Puelicher, the CEO of Marshall & Ilsley, wrote an annual report which read, in entirety, as follows: “Your company had a very good year in 1982. Some of it was due to luck; some of it was due to good planning and management. We hope you enjoy the numbers and the pictures.”
I loved how Puelicher followed Shakespeare’s wisdom in that brevity is the soul of wit, and I also like the acknowledgement that luck played a role in his investments. With stocks in the S&P 500 up over 20% on average, it is easy for most of us to look in the mirror and see the visage of Warren Buffett when we look back upon the movements of our own investments in the past twelve months. It seems that the only way you could have lost money this year is if you owned large amounts of … Read the rest of this article!