KISS, diversification and balance
Mathematical models that show price correlation will give precise answers but aren’t useful
Part 7: Building and Managing a Portfolio
Watchlists can be a waste of time
But I am not building up a baseball bullpen of game-ready companies
Fifty years – Beaten the market
It’s amazing that 2% makes such a big difference
Conventional diversification makes no sense
The concerns which fail are those which have scattered their capital, which means that they have scattered their brains also. They have investments in this, or that, or the other, here, there and everywhere
The search for a better guide to stock values
Can we improve on the accuracy of these estimates by obtaining estimates from, say, 22 leading investment banks and averaging them?
The Equity Risk Premium and what to use it for
On this basis it could be argued that, at that time, since expected returns were well below historic norms, prices were too high.
The best number of stocks to own
Too much of a good thing can be wonderful
A time of maximum pessimism
So we search for those things that other people are selling and then if the problem or adverse outlook is temporary we buy them and hold them patiently for years until the public changes its mind.
Scatter shot estimates of fair value
A group with a high anchor were prepared to pay three times as much for the same wine as a group with a low anchor
The problem with stock screening
What is worse, it directs the investor to a list of companies that may be completely out of tune with today’s economy
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