Hottest links for Tuesday September 17th, 2013 (see Monday‘s edition of hottest links here). Top stories for today include; Using quant methods to pick a super bowl champion,; Yale Magazine has a great in-depth article on a prominent alumni, Jim Chanos; Learning from Tom Russo about global value investing; The Value Investing Congress started yesterday, speakers including founders of ValueAct, Starboard and other prominent activist hedge funds, its a good time to catch up on coverage; Jamie Dimon’s daughter gives her financial advice but first asks what is a bond; This person owns more shares of Berkshire than Bill Gates. That and much more below.
Note tomorrow will be the last hottest links for this week.
How to Win NFL Pick’em
It is a simple quant, anti-consensus method to win your NFL (or any sport) pickem league (where you bet against the spread in a closed league). If you have been following this you would likely have won both weeks thus far in 2013. [Mebane Faber]
Yellen Is Now Top Fed Hopeful
White House Leans to Vice Chairwoman After Summers’s Withdrawal From Consideration. [The Wall Street Journal]
The Fraud Detective
On a muggy Thursday in the dog days of August 2011, the news broke that the American technology giant Hewlett-Packard Company (NYSE:HPQ) was about to acquire British software maker Autonomy Corp (OTCMKTS:AUTNY). The offer price represented a 64 percent premium on the previous day’s close. At his office in mid-Manhattan, hedge fund manager Jim Chanos ’80 did not rejoice. [Richard Conniff, Yale Alumni Magazine]
What Is Going On Now
Even though the S&P 500 (INDEXSP:.INX) is at an all?time high (not adjusted for inflation), investors are still gloomy. TIPS are at a negative 1.3% yield. And that is with no inflation. Only makes sense if you think that every other asset class will do worse in the next five years. [David Baskin, Barry Schwartz and Scott Mazi, Baskin Financial Services]
Learning from Superinvestors: The Wisdom of Tom Russo
Tom Russo has been one of the most generous value superinvestors in terms of sharing his knowledge and experience with the value investing community. Russo’s investment approach is focused on a small number of industries in which companies have historically proven to be able to generate high and sustainable returns on capital and returns of capital. [Oliver Mihaljevic, Beyond Proxy]
Strubel Investment Management September 2013 Investor Letter
How long do you think the average investor today hold a stock? If you guessed less than a year, then you are correct. The average holding period for a stock dipped below a year sometime after 2000 and has continued to fall. Here is how long it takes various businesses to perform critical tasks: To develop a new pharmaceutical drug: 12 years (Pfizer Inc. (NYSE:PFE), Merck & Co., Inc. (NYSE:MRK), GlaxoSmithKline plc (ADR) (NYSE:GSK) (LON:GSK), etc.), For a defense contractor to design and build a new fighter aircraft: about 10 years (The Boeing Company (NYSE:BA), Lockheed Martin Corporation (NYSE:LMT), Northrop Grumman Corporation (NYSE:NOC), EADS NV (EPA:EAD), etc.) For a software company to develop a new operating system: about 2-4 years (Microsoft Corporation (NASDAQ:MSFT), Apple Inc. (NASDAQ:AAPL)). [Strubel Investment Management]
Value Investing Congress 2013: Marcato, ValueAct, Starboard
The second Value Investing Congress is all set to take place soon on September 16-17 in Rose Hall Time Warner Center. Gone are the times when VICs featured Einhorn’s 140 slide presentations; the lineup for this conference is slightly different this year. Guy Gottfried, from Rational Investment Group. He is a regular at Value Investing Congress and will be speaking again. In May’s VIC that took place in Las Vegas, Gottfried gave his long views on WPX Energy Inc (NYSE:WPX), shares of WPX are up 28% YTD. Notably David Einhorn’s Greenlight Capital bought a new position in WPX Energy Inc (NYSE:WPX) in the last quarter. [Tabinda Hussain, ValueWalk]
Deep Thoughts From Jamie Dimon’s Daughter On Fi-Nance
Of course, the fact that fi-nance is so incomprehensible to most people is the reason bankers tend to rake in 7, 8 or more digit compensation every year. Because if mere mortals were to grasp just how detrmental to their health the “fi-nancial innovation” sold by banks like JPMorgan Chase & Co (NYSE:JPM) is, or just how deep the rabbit hole dug with money created out of thin air goes, the IRR (funded using other people’s money) to the banking industry would be substantially lower. [Tyler Durden, Zero Hedge]
Barclays Is Still Paying for Qatar’s Bad ‘Advice’
Barclays PLC (ADR) (NYSE:BCS) (LON:BARC) is off raising $9.2 billion to shore up its capital, and the prospectus has a rather awkward disclosure, which is that British regulators are planning to fine Barclays $79 million because the last time it raised a bunch of capital it maybe lied to shareholders to cover up the bribes it paid to Qatari investors to buy its shares. But that was, like, almost five years ago, so surely there are no hard feelings? [Matt Levine, Bloomberg]
CAPE Ratio Newsletter
Most Recent CAPE Ratio Newsletter. Be sure to sign-up for future Newsletters as we will not be posting these on our website for long! [CAPE Ratio Calculator]
Roles in Life Rule Investment Decisions
In studying investment managers for more than fifty years, I have learned that the roles that they have played through their lives have an enormous influence on how they invest. [A. Michael Lipper, CFA Institute]
Why Crimson Wine Group Could Be Worth $20
My original decision to purchase Crimson Wine Group Ltd (OTCMKTS:CWGL) was primarily based on my assessment that the stock, which was trading at under $8, was trading at a big discount to the assets of the company (over $13). Additionally, savvy management seemed eager to own this asset. [Tsachy Mishal, Capital Observer]
The Debate on DFA’s Research
Fama and French and others at DFA would also freely admit that no amount of empirical or theoretical work (or out-of-sample tests) can guarantee that the future returns of any strategy will look like past returns. [Jared Kizer, Advisor Perspectives]
Tiger Global Increases BBA Aviation Stake
Chase Coleman and Feroz Dewan’s hedge fund, Tiger Global Management has increased its stake in London listed BBA Aviation plc (LON:BBA) (OTCMKTS:BBAVF). [Market Folly]
A Few More Thoughts On Rhoen Klinikum
I had made a very quick analysis how I looked at the news that Rhoen now sells 2/3 of their business to Fresenius in order to sidestep the blocking shareholders. [ValueAndOpportunity]
Vodafone’s Mega-deal Will Have Rewarded Contrarian Investors
The one issue that remained outstanding – in the sense of ‘conspicuous’ as well as ‘unresolved’ – was the potential disposal of Vodafone Group Plc (ADR) (NASDAQ:VOD) (LON:VOD)’s 45% stake in US mobile network operator Verizon Communications Inc. (NYSE:VZ). [Andrew Lyddon, TheValuePerspective]
I Went to Cash Because
I went to cash because (please check one): 1. Sequestration 2. The Taper 3. Obamacare 4. Debt Ceiling 5. Egypt Revolution. [Joshua M Brown, The Reformed Broker]
Berkshire Billionaire Found With More Shares Than Gates
Frustrated, Horejsi bought 40 shares of Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE:BRK.B) for $265 each with the company’s cash after friends told him about Warren Buffett, the company’s then-little known chairman. He bought another 60 shares two weeks later at $295 and 200 more at $330 a month after that. [Richard Teitelbaum, Bloomberg]
Hottest Links: Not The Onion
Creepy Northampton clown terrifying residents
A creepy and anonymous clown has been terrifying residents of Northampton by standing around on street corners and staring at passers-by. [Rob Williams And Oscar Quine, Belfast Telegraph]
