Hottest links for Saturday and Sunday 11th-12th January, the weekend edition (see Friday’s edition of hottest links). Get our free daily newsletter (the updated version) and never miss a single linkfest. Also, now if you sign up you will get our new e-book on value investing.
Lots of great value investing related topics over the past couple of days including; Much more on the great CAPE (Shiller PE debate); I entered two years ago, now who is investing in Europe? The always great Jason Zweig weighs in on the bubble argument; This might be the best value stock ever, only problem is that it cannot be purchased. That and much more from the top stories for today are below.
Hottest Links: Stories
What went wrong in 2013
Is It A Good Time to Be a Stock Picker? Interview With Worm Capital
ValueWalk's Raul Panganiban interviews Eric Markowitz, Director of Research, and Dan Crowley, Director of Portfolio Management, at Worm Capital. In today’s episode they discuss their approach at Worm Capital and where they find opportunities. Q4 2020 hedge fund letters, conferences and more Interview with Worm Capital's Eric Markowitz and Dan Crowley
This year the answer is simple: Just about everything went wrong! My value portfolio, what I write about here, was up a measly 5% when the overall market was up over 30%! [Long Term Value Blog]
2013 Portfolio Performance Review
To see how these returns were generated, let’s first have a look at my how portfolio looked on January 1st of last year: [Mackie, Moatology]
The Shiller CAPE: Addressing the Responses
In this piece, I’m going to address three responses to my earlier piece on the Shiller CAPE. [Philosophical Economics] Related Leaving CAPE Town The current CAPE Ratio for the S&P 500 (INDEXSP:.INX) stands at just over 25, above the long-term average in the mid-teens but nowhere near the impossible heights of 1999, which were closer to 45. [Joshua M Brown, The Reformed Broker]
The smart money may have already boarded the boat to Europe
The benchmark STXE 600 PR.EUR (INDEXSTOXX:SXXP) is up 0.6% in the very young year-to-date, while the S&P 500 INDEX (INDEXCBOE:SPX) is on track for a 0.6% pullback. For 2013, the index pulled off its best performance since 2009. [Barbara Kollmeyer, MarketWatch]
Market Bulls Should Consider These Charts
While the promise of a continued bull market is very enticing it is important to remember, as investors, that we have only one job: “Buy Low/Sell High.” It is a simple rulethat is more often than not forgotten as “greed” replaces “logic.” [Lance Roberts, Pragmatic Capitalism]
BlueCrest Builds a Hedge Fund Empire
When hedge fund managers venture into new areas, they typically move gradually. Not Michael Platt, co-founder of BlueCrest Capital Management. [Jesse Westbrook, Bloomberg]
Buffett & Icahn: The New Rail Barons
Record backlogs in revenues mean that there is interest by investors, but billionaires like Carl Icahn and Warren Buffett have already made their bets. [Warren Buffett]
When Does a Bubble Spell Trouble?
The minutes of the latest Federal Reserve policy meeting, released this past week, show that central bankers have been worrying that the financial markets might turn into a bubble—the term for a perilously overvalued situation that can burst without warning or mercy. [Jason Zweig, The Wall Street Journal]
Look Out Below for Five Below?
Classic case: Five Below Inc (NASDAQ:FIVE). This is one I’ve been hearing about as a disaster-in-the-making for months, but hadn’t yet focused on or written about. Still, it’s a good case study, and with 21% of its float sold short, it appears investors shouldn’t have been surprised by its earnings warning. [Herb Greenberg, Herb on TheStreet]
Maxxam, unbelievably cheap at 27% of BV and potentially 2x earnings
MAXXAM Inc. (OTCMKTS:MAXX) has struggled to generate cash flow to as they’ve struggled to survive over the past five years. Executive salaries have been cut, and the company delisted from the NYSE Euronext (NYSE:NYX), which purportedly saved over $1m. [Nate Tobik, Oddball Stocks]
The Steve Madden counter example
The stock in the Wolf of Wall Street (Steve Madden Shoes) has been a thirty bagger. It is also a challenge to the Bronte business model. [John Hempton, Bronte Capital]
Post Holdings Annual Report 2013
The other difference between Post Holdings Inc (NYSE:POST) and a private equity fund is that POST is investing with permanent capital whereas private equity funds have an exit date in mind when they enter a purchase transaction; at some point there needs to be a liquidity event to return capital to fund investors upon expiration of the fund. [KK, The Brooklyn Investor]
Hottest Links: Not the Onion
Coinye responds to Kanye complaint, says currency now based on ‘half-man half-fish hybrid’
The developers of Coinye — formerly known as Coinye West — have responded to a cease and desist letter from Kanye West with their own cease and desist, insisting that an updated version of their cryptocurrency is unrelated to the singer and now references a “half-man-half-fish hybrid who is wearing sunglasses.” [Adi Robertson, The Verge]