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Interview with deep value investor Monish Pabrai
- Thread starter makloda
- Start date
Quote from day7793:
<much deleted by me>
[BTake a look at the charts of RAIL, PNCL and some of his holdings some other obscure stocks that he owns. They have low P/Es and high ROE, I agree. But the stocks are in the dumpsters! Technical charts suck. There is no promise if that business will make it big. Why would you invest 2-3 years of your dollars in some doubtful business just because you bought it 50- 75 cents on the dollar when you can reap twice as much on some great running bullish stocks that pay cash divvys ?
[/B]
Well, allow me to answer just this part. On Friday I picked up a shitload of BNI; this is a W.B. play on the rails. HIGH ROE as you mention. Was thinking about being a buyer at under 82, but it went on heavy sale due to last week so I loaded up. The why is simple...FUTURE EARNINGS POTENTIAL. Rail=moving lots of weight efficiently in our oil challenged future. Now, just sit around writing butt loads of covered calls and wait for the inevitable 50 percent jump in value. Now that's simple. Now just think about what I've done.
Here's something to get you started. Way back when, sometime after the tracking stock was split off, I traded in and out of a stock CG. Then, when it was like 17 bux, it had a quarterly of something like .45, giving it an annual return of over 10 percent. I loaded up then, and still have most all of it. The stock currently trades at like 75 dollars, and the dividend hasn't changed in 4 years at .455/qtr. Just now getting ready to spark up the December covered call selling.
I use this play as a retirement, and as such these plays are exquisite. The dividends are gravy. Daytrade some, do this for the long run. Enjoy life.
Quote from jdeezero05:
the fact your comparing returns on 150k to the returns on 500 million or billions i'm going to have to go with "hell no".
The size of account doesn't matter. Its the yield that matters. Pabrai has some 300 million in the market not 500 million to be correct. Yield is irrefutable.
What it shows you that a smaller investor has a better yield than a larger investor and can scale up the whole set up if needed. There is one more thing though, the bullmarket.
Value investing takes a backseat when new highs are made and indexes are shattering records. You don't hang on with stocks for months and years, its short term trading.
When I look at companys chart, fundamentals don't matter.
I ask the stock what have you done for me lately? If I bought you 6, months, 12, months and 2 years ago what would I be getting out of you now? Where have you been lately? What are you going to do for me now?
Just look at the charts of BRK.A and BRK.B and see what have they done for anyone lately.
Quote from day7793:
The size of account doesn't matter. Its the yield that matters. Pabrai has some 300 million in the market not 500 million to be correct. Yield is irrefutable.
What it shows you that a smaller investor has a better yield than a larger investor and can scale up the whole set up if needed. There is one more thing though, the bullmarket.
Value investing takes a backseat when new highs are made and indexes are shattering records. You don't hang on with stocks for months and years, its short term trading.
When I look at companys chart, fundamentals don't matter.
I ask the stock what have you done for me lately? If I bought you 6, months, 12, months and 2 years ago what would I be getting out of you now? Where have you been lately? What are you going to do for me now?
Just look at the charts of BRK.A and BRK.B and see what have they done for anyone lately.
Are you working? You shouldnt be. You should be managing your account full time. At your current rate of return you'll be the richest person in the world in 20 years. Congrats.
Quote from keyser1:
Are you working? You shouldnt be. You should be managing your account full time. At your current rate of return you'll be the richest person in the world in 20 years. Congrats.
I manage my account full time. I hate to break it to you, that consistent income generation strategies are the way to go. Doing high probabilities trades and sticking to position sizes and not chasing high IV speculative trades is the way to be around for sometime. You can beat all these Mohnish Pabrais and Warren Buffets in shorter time periods. Just look at Berkshire Hathway what has the stock done for its investors? Nothing this year 2007, its a sideways show. Not for me.
Currently I have ceased trading when RUT, SPX, INDU splatter up and down with huge moves. I will " Guide" my positions to successful expiration this week. End of runway. See the word guide in caps and desist to trade further till situation improves. My 5-10% income In September may drop, but the powder is dry ready to bet when the odds improve again in October/ November run.
I just don't understand the hype with RAIL. Sounds like a dead company to me.
http://www.reuters.com/article/marketsNews/idUKN2645254320070726?rpc=44
http://www.reuters.com/article/marketsNews/idUKN2645254320070726?rpc=44
Quote from aaronk321:
I just don't understand the hype with RAIL. Sounds like a dead company to me.
http://www.reuters.com/article/marketsNews/idUKN2645254320070726?rpc=44
Dead and cheap. Negative earnings, falling sales. Great prospects right? Where is your common sense before you pull out P/E and PEG ratios.
If you are interested in staying with this stock for 2 years and than come back and show me a 20% return, I would call you a value investor.
Yea continue beating legendary deep value investors that made hundreds of millions of Dollars in the markets with your put writing "strategy". You will come out on top, I have no doubt.Quote from day7793:
You can beat all these Mohnish Pabrais and Warren Buffets in shorter time periods. Just look at Berkshire Hathway what has the stock done for its investors? Nothing this year 2007, its a sideways show. Not for me.
Quote from makloda:
Yea continue beating legendary deep value investors that made hundreds of millions of Dollars in the markets with your put writing "strategy". You will come out on top, I have no doubt.
I have read Mohnish Pabrai's new book " DHANDO INVESTOR" The book is great tells you all about kelly formulas, low risk arbitrages and praises WARREN BUFFET wall to wall. Its more of a fatherly complex the author drives from Warren Buffet in my opinion. It also narrates Mohnish's value investing in the past and how he did few companies.
Well that is very good, but I was left holding the book in my hand, wondering how I can do it myself ? Why did I buy this book in the first place?
Dhando Investor is very circumspect about revealing any methods and nuts and bolts of value investing. In fact the author, hides those very same techniques that makes him money. In other words it leaves the reader, not knowing how to fish on his own.
I am no fool, I could see that easily.
Quote from thriftybob:
There is such a thing as deep value investing, and it does works.
As far as buying, you have to be willing to buy the things NOBODY else wants, and time it so its just before they change their minds, that's all.
the guy is a "DEEP value investor". some of you guys seem miffed that his recent buys are not rocket ships. the guy is up 600% or whatever in 8 years.