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David Einhorn: Q2 2019 Top 10 Holdings

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  • These documents allow investors to track their favorite superinvestors, their fund’s current holdings, plus their new buys and sold out positions.
  • We spend a lot of time here at The Acquirer’s Multiple digging through these 13F-HR documents to find out which superinvestors hold positions in the stocks listed in our Stock Screeners .
  • This week we’ll take a look at David Einhorn (6-30-2019).

Distressed Investing – How To “Paper’ A Deal Without Committing Light Treason

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  • During his recent interview with Tobias, Thomas Braziel, the Founder of 507Capital, discusses how to ‘paper’ a deal without committing light treason saying:
  • Thomas Braziel: In the area we work in or I work in, I feel like the hardest thing is papering stuff.
  • People will say things, ‘How do you get comfortable with this transaction?’ Being like, ‘Well, we do it through spending, first, our whole lives trying to paper stuff and figure out how to paper is securely.

Schroders: Has Value Investing Been Disrupted?

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  • Value investors can and do benefit from new and innovative technology businesses, but only when they are offered to us at attractive prices.
  • Just as a good business is very different to a good investment, a low price is very different from good value.
  • The stocks of companies that are changing the world, irrespective of their prospects of profitability, tend to outperform in times of optimism as the market pays up for that potential.

Thoughts on the Fed

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  • If the Fed did that, Fed funds would have to be 0.65% lower than now.
  • Perhaps then policy should force the yield curve to invert once every five years, say with a slope of -0.50%, and hold it there for a year or so.
  • As a result, the yield curve would steepen and banks would lend more, lessening the need for monetary policy to loosen.

All German Shares – Part 3

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  • Optically the company is quite cheap (high net liquidity) but there is little hope for any changes to the upside although they have started a share repurchase program.
  • As with Bremer Lagerhaus, the biggest issue is that local Government owns more than 50%, so a clear “pass” for me despite an “ok” valuation and a attractive underlying business.
  • A 193 mn EUR market cap company with a very interesting product portfolio, i.e. specializing in energy efficient technologies for buildings.

Some Thoughts on Recent Factor Trends (Value/Momentum/LowVol)

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  • This WSJ article covered this interesting rebound of value factor [ link ], the author James Mackintosh however doesn’t think the rebound can last because he personally believes in the disrupters’ long term secular advantages.
  • Higher correlation (overlapping) between Low Volatility & Momentum factor?
  • Last , I want to share a relevant working paper on explaining the “demise of value investing” .

Some Thoughts on Recent Factor Trends (Value/Momentum/LowVol)

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  • This WSJ article covered this interesting rebound of value factor [ link ], the author James Mackintosh however doesn’t think the rebound can last because he personally believes in the disrupters’ long term secular advantages.
  • Higher correlation (overlapping) between Low Volatility & Momentum factor?
  • Last , I want to share a relevant working paper on explaining the “demise of value investing” .

ValueAct Sells Some KKR and CBRE Group

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  • Per the filing, ValueAct now owns 8.8% of the company with 48.1 million shares.
  • Second, Ubben's firm has filed a Form 4 with the SEC regarding its position in CBRE Group (CBRE).
  • They sold 3 million shares on September 12th at $53.86.

6 Low-Risk, High-Yielding Dividend Stocks

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If your goal is to accumulate wealth for a comfortable retirement, then there is no risk-free path. Yield and risk tend to follow each other. As risk increases, the investor demands more yield to compensate for that risk. Sometimes it is desirable to accept higher risk for a higher yield. Other times we may be accepting higher risk and are not being adequately compensated for the additional risk.

What We're Reading ~ 9/18/19

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  • Super Pumped: The Battle for Uber [Mike Isaac]

An update on Conduril

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  • I bought my first shares in Conduril in 2012 for €22/share, and now, almost 7 years later we are roughly back to where I started with a shares trading at €25.
  • It hasn’t been a total dud though, because in that period the company did payout a total of €9.50/share in dividends.
  • I was also […]

Seth Klarman: Investors Remain The Consummate Yield Gluttons!

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  • In his 2004 Baupost Shareholder Letter, Seth Klarman made his thoughts clear on the inability of most investors to sit on the sidelines and hold cash when markets are expensive, saying:
  • This path also involves risk in that there is no certainty whether or when this will occur; indeed, securities prices could rise further from today’s lofty levels, making the decision to hold cash even more painful.
  • Most significantly, they remain highly skewed toward the greed end (how much can you make?)

Invest Like David Tepper – Search For Stocks With ‘Cheap Optionality’

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  • During his recent interview with Tobias, Thomas Braziel, the Founder of 507Capital, discusses the importance of searching for stocks with ‘cheap optionality’.
  • If you have, again, crypto distress is interesting because you’re getting distressed pricing and you’re getting a real steak because you’ve got a state value above what you’re paying.
  • I guess the more technical way to say it is you’re looking for cheap optionality or free optionality or free options and things like that.

On Income Inequality

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  • The question – While there will always be income inequality in a free market economy, does crony capitalism have the effect of increasing income equality by means of subsidies, regulations, protection of monopolies, etc?
  • Yes, you can argue about big government, labor, and business, but that is only a part of the puzzle.
  • What matters most is the culture of a nation, and how they are motivating the next generation to compete.

Insights on VC Pricing: Lessons from Uber, WeWorks and Peloton!

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  • In the picture below, I have taken the total market descriptions given in the Uber, WeWork and Peloton prospectuses:
  • In fact, most of the IPO companies this year have had:
  • Posts on Venture Capital Venture Capital: It is a pricing, not a value, game!

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