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Charlie Munger: Don’t Invest Like A Lemming

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  • AUDIENCE MEMBER: Very good morning to Mr. Buffett and Mr. Munger.
  • We have here in the Bookworm, copies of “The Intelligent Investor”, and I think it’s as great a book now as I did when I read it early, I guess, in 1950.
  • That’s the book that gave me the philosophy that has taken me now for a lot of years.

Latest Research: Will Value Investing Ever Rebound?

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  • The paper discusses the two major reasons for the demise of value investing and speculates on the likelihood of a resurgence.
  • Here’s an abstract:
  • The business press claims that the long-standing and highly popular value investing strategy—investing in low-valued stocks and selling short high-valued equities—lost its edge since 2007.

The Pluses And Minuses Of Facebook’s Libra

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  • Tyrone Ross: So this is what Facebook was looking to do.
  • If there’s a way for people to monetize it to make their lives better and they don’t align with your values but they can benefit from it to improve themselves, again that’s just a juxtaposition of life, wherever there’s bad there’s always good, and where evil there’s always prosperity.
  • And I’m like, “Oh god.” So again, they could keep people off.

Mitie disappointment or Mitie dividend potential?

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  • Mitie Group is the UK’s largest facilities management (FM) company and it joined my personal portfolio and the UK Value Investor model portfolio way back in 2011.
  • In layman’s terms, Mitie provides corporate and government clients with outsourced services (mostly property-related such as maintenance, security and cleaning) so that its clients can focus on their core activities rather than non-core activities like fixing a boiler or cutting the grass.

“All German Shares” series – Part 1

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  • 1: DEMIRE (Deutsche Mittelstands Real Estate) AG – ISIN DE000A0XFSF0
  • The company has a market cap of 530 mn EUR and is stating an NAV of ~5,85 EUR compared to its latest stock price of around 4,90 EUR.
  • Tiny real estate company (market cap 15 mn) with problems and in the process of being squeezed out.

Crypto Is The Digital Version Of The Centuries Old Sou-Sou

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  • Me to you without a bank.
  • The other part is the people who are lacking financial services now don’t trust banks, and they also realize that I may not have enough money to use a larger bank anyway, so we’d rather just stay unbanked, or use payday loans, or use check cashing places, or the post office where people go to get money orders and cash money orders.
  • Tyrone Ross: So if you go to any inner city community where there’s a large Caribbean population, they use this because they can’t use banks.

Joel Greenblatt: It Will Always Be Possible To Beat The Market, Here’s Why

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  • There’s huge dispersion going on within that average between stocks that are in favor that people love emotionally and stocks that people hate.
  • Within that average is smoothing things.
  • Listen to what I told my students since they were 10 years old.

Runaway Story or Meltdown in Motion? The Unraveling of the WeWork IPO

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  • Explosive growth: As we will see in the next section, WeWork does not just have a mismatched model, it is one that has scaled up at a rate that has never been seen in the real estate business, going from one property in 2010 to more than 500 locations in 2019, adding more than 100,000 square feet of office space each month.
  • To the question of whether WeWork could be worth $40 billion, $50 billion or more, the answer is that it is possible but only if the company can deliver well-above average margins, while maintaining sky-high growth.

Cost of shorting Beyond Meat

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  • Even assuming I can get a borrow, if I were to short 100 shares of BYND at current market prices, I’d have to pay $88/day in interest expenses (another way of thinking about this – 88 cents per share per day!)
  • Even deeper in the money (e.g. strike price of $175) your break-even, even if you get a mid-point execution is $116/share, or basically paying a 22% premium to short the stock.

4 Dividend Stocks Raising Their Dividends And Yields

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At some point in the future will we look back at our actions today and refer to them as our greatest missed opportunity? A successful dividend growth strategy takes time. Unfortunately, many income investors don't have the luxury of time on their side and must focus on high-yield investments to meet current expenses. These high-yield investments are often accompanied by high-risk. For those with time, a solid long-term strategy focusing on quality stocks that grow their dividends will treat them well in their retirement years.

(Ep.27) The Acquirers Podcast: Tyrone Ross Jr – Crypto Athlete, Financial Consulting, Bitcoin, And Start-Ups

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  • And I’m like, “Oh god.” So again, they could keep people off.
  • And that’s the thing, we don’t know.
  • I know the people that you have on here, people that I admire, people that I respect, people with really big brains.

The “All German Shares Series” – Intro

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  • These days, I only have a relatively small domestic stock allocation left (P. Hartmann, Draeger, Innogy) and mostly screen for international stocks.
  • Time for change: Looking at every German share

Doing the Work is NOT Enough

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  • Maybe the second-best thing for me to do to save the two other cups was to let the first one go.
  • The lesson I learned by breaking those three cups was that often, the best thing we must do with a lost cause is to let it go .
  • Well, it is not just about lost causes, but about everything we do in life, including investing in stocks.

Some links

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  • The UK Value investor with a deep dive on UK utility SSE Great summary on what investors can learn from operators and vice versa Must read from Ben Thompson: What is a Tech Company Recommended: The “Ruffer Review 2019” with a lot of interesting but cautious stories on financial markets The “Drone Bubble” seems to finally burst Google tries to keep search users on their site more and more The WeWork IPO seems to come at a lower valuation as inititally thought

Selling SSE: A defensive utility with lots of problems

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  • Wholesale (around 30% of overall profits from producing gas and electricity); Networks (around 50% of overall profits from distributing gas and electricity around the UK); Retail (around 20% of overall profits from selling gas and electricity to businesses and households).
  • Low returns: SSE’s networks business owns and operates regulated network assets.
  • But I want to invest in focused businesses with high returns on capital, low debts, low external risks and some durable competitive strengths.

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