If the CAPM is flawed, what can replace it? The best approach would be to assess whether companies in general and relatively speaking, the company in question, can raise money cheaply in public offerings.
When investing, we view ourselves as business analysts – not as market analysts, not as macroeconomic analysts, and not even as security analysts
Unless management holds the major part of their family net worth in shares of the company there is a serious potential agency problem
The vast majority of wealth creation comes from a reasonably sized cohort of successful companies. The trick is to identify these wonderful businesses.
The best business to own is one that over an extended period can employ large amounts of incremental capital at very high rates of return
But I am not building up a baseball bullpen of game-ready companies
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