Hottest links for Monday September 24th, 2013 (see prior edition of hottest links here). Top stories for today include; A great analysis of ;Ray Dalio is back (sorta), ZeroHedge reports that the famous hedge fund manager is now long treasuries; Seth Klarman just is not having luck buying companies which want to (sorta secretly) dig massive mines in foreign countries, first Canada now Romania is angry, check out the latest from ValueWalk on that; Ben Graham the market timer? Yes says one value investor and has some good evidence to back him up; Prem Watsa is buying Blackberry Ltd (NASDAQ:BBRY) (TSE:BB) if you have been in hiding; Nine things that can make you a good investor (and you do not even have to be rich); You didn’t beat the market? Don’t feel bad neither did all the experts who told you what to buy; Want to attract affluent clients? Here are some tips; That and much more in today’s hottest links.
Programming note: We will be off Thursday and Friday this week, but starting next week hottest links will be back six days a week going forward.
Hottest Links: Stories
Moonwalking with Einstein
Chris over at The View from the Blue Ridge posted a great excerpt from the book Moonwalking with Einstein, which is pasted below. That book may have been the most useful one I’ve read over the past couple of years from an investing standpoint, as I’ve used what I learned from it to help me improve my filtering process when it comes to looking at investment ideas….a process that continues to evolve and (hopefully) improve. [Joe Koster, Value Investing World]
Sears Holdings Transformation Picks Up Steam, But Will Still Take Years
It’s been nearly ten years since Sears Holdings Corp (NASDAQ:SHLD) CEO and majority shareholder Eddie Lampert pulled off the Kmart/Sears merger that had investors salivating over the potential for enormous realization of the company’s real estate value. [Chad Brand, Peridot Capitalist]
Ben Graham Knew How to Time the Market
Back in 1986, Henry R. Oppenheimer wrote a paper titled Ben Graham’s Net Current Asset Values: A Performance Update. The paper studied the number of net nets that existed from 1970 to 1982 and its performance. The main objective of that paper was to see how NCAV stocks performed. [Jae Jun, Old School Value]
9 Things You Don’t Need To Be A Rich Investor
Consider that simply by buying a S&P 500 INDEX (INDEXCBOE:SPX) fund 10 years ago, you could have doubled your money when you count dividends. And consider that even if you bought at the dot-com peak in 2000 you would have gained almost 50% including dividends. Even if you’d bought the top in 2007 you’d have roughly 30% total returns. Sure, you can make it rich betting right on a fund like Direxion Daily Large Cap Bear 3X Shares (NYSEARCA:SPXS), which goes up three times as fast as the market goes down. But it’s a bet — pure and simple. [Jeff Reeves, Market watch]
OTC Stock Performance Study
Over-the-counter (OTC) stocks are far less liquid, disclose less information, and exhibit lower institutional holdings than listed stocks. We exploit these different market conditions to test theories of cross-sectional return premiums. [Wesley R. Gray, Turnkey Analyst]
Meet Prem Watsa: The Man Riding to BlackBerry’s Rescue
Who is BlackBerry’s savior: The so-called Warren Buffett of Canada. [David Benoit, WSJ]
The Price of Wine
Elroy Dimson, Peter L. Rousseau and Christophe Spaenjers examine the impact of aging on wine prices and the performance of wine as a long-term investment, using a unique historical database for five long-established Bordeaux wines that we construct from auction and dealer prices. via MebFaber.
There’s No Time Like the Present to Fire Your Investment Consultant
Researchers Tim Jenkinson, Howard Jones and Jose Vicente Martinez find some evidence the real source of institutions’ crummy consulting advice may be themselves. [Brendan Conway, Barron’s]
Don’t Feel Bad, The Pros Can’t Pick Managers Either
Today’s must-read article belongs to Steve Johnson at the Financial Times, who concludes that institutions have wasted billions of dollars on the advice of manager-picking consultants. [Joshua M Brown, The Reformed Broker]
Seth Klarman Striking Out In Gold And Limestone Mining
Romania has witnessed massive protests against the Canadian gold mine project for almost four weeks now. About 15,000 Romanians gathered in Bucharest, the capital of the country, to voice their disapproval of a new mining project by Gabriel Resources Ltd. (TSE:GBU). [Tabinda Hussain, ValueWalk]
Bridgewater Goes Long Treasurys
For a long time, Ray Dalio’s Bridgewater, the largest hedge fund (excluding the Fed of course) was a firm believer that thanks to the “beautiful deleveraging” thesis or namely a world in which nominal GDP growth is above nominal interest rates, driven lower primarily and some would say exclusively by the backstop of Fed purchases with the result being a decline in debt relative to GDP, there could be a way out of the Keynesian liquidity trap. [Tyler Durden, Zero Hedge]
A Quick Tour of Emerging-Markets Value
Emerging-markets assets have staged a mild recovery thus far in September after a fairly intense summer sell-off. Most obviously, emerging-markets equities have rallied nearly 9 percent from their lows on August 28, while other markets have posted gains as well. [Michael Hood, Institutional Investor]
Open-Government Laws Fuel Hedge-Fund Profits
When SAC Capital Advisors LP was weighing an investment in Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) the hedge-fund firm contacted a source it knew would provide nonpublic information without blinking: the federal government. [Brody Mullins and Christopher Weaver, WSJ]
Four Ways to Attract Affluent Clients
Last week, I wrote about a California advisor who transitioned her book to focus on affluent clients. Central to her success was the understanding that marketing to affluent investors requires a different approach. Attracting HNW clients is all about credibility – as a result, it’s typically lower key, takes longer and requires an upfront investment of time and effort to position yourself to interact with HNW prospects. [Dan Richards, Advisor Perspectives]
Investor Mindsets Mine Different Results
Is changing investment attitude all that is needed to change investment results? Is it as simple as changing your paradigm — flipping the coin to the other side? In my search for these and other answers I often take the contrary view; I flip the coin to the other side. I do this frequently in my conversations with CEOs of investment firms, chief investment officers, portfolio managers, analysts, and, most importantly, investors. I try to learn from all of them to help the accounts for which I am responsible. [A. Michael Lipper, CFA Institute]
Hottest Links: Not The Onion
Bono Chased by Angry Anarchists in Germany
The group was supporting the ‘Make Bono History’ campaign, which aims to “remove Bono from the public-eye and restore a sense of dignity to mankind”, and the singer was terrified when the placard-waving demonstrators started chasing him. [wenn.com, MSN]
