In a wonderful book, well worth reading, “The Great Investors: Lessons on Investing from Master Traders”, the author, Glen Arnold, writes on the John Neff’s investing approach.
John Neff: Difficult Times
John Neff would look for good companies which have fallen on hard times as investors become excessively wary, pushing the share price too low. For example, the Windsor Fund under John Neff’s guidance, in the late 1980s, bought into property and casualty insurers when environmental liabilities were hurting the insurance industries dragging them downwards. The Doomsday scenario did not occur and the insurance companies reserves were more than sufficient for them to cope. Then, when The Home Depot, Inc. (NYSE:HD)’s profits fell in 1985, due to pre-opening costs and expanding overheads, the forward looking PER fell to a mere 10 (the Windsor Fund made a 63 per cent return in nine months).
See the ful article here Capital Ideas Online and more from the book below
Chris Hohn the founder and manager of TCI Fund Management was the star speaker at this year's London Value Investor Conference, which took place on May 19th. The investor has earned himself a reputation for being one of the world's most successful hedge fund managers over the past few decades. TCI, which stands for The Read More
‘Whether a complete novice, or a professional portfolio manager, this book will give you access to the mindset and techniques of the most successful investors of our time and more importantly, it will help you avoid mistakes. The Great Investors will have a permanent place on my desk.’
Mark Sheridan , Executive Director, Nomura International PLC
Leading investors such as Warren Buffett, Benjamin Graham, Sir John Templeton, George Soros and Anthony Bolton are known throughout the world. How did these people come to be so successful? Which strategies have they used to make their fortunes? And what can you learn from their techniques?
In The Great Investors, Glen Arnold succinctly and accurately describes the investment philosophies of the world’s greatest investors. He explains why they are the best, gives details of their tactics for accumulating wealth, captures the key elements that led to their market-beating successes and teaches you key lessons that you can apply to your own investing strategies.
The Great Investors: From the foreword
‘There are some very special people who seem to possess an exceptional talent for acquiring wealth. I want to explore not just the past triumphs of these masters, but also the key factors they look for as well as the personality traits that allow them to control emotion and think rationally about where to place funds. How does a master of investment hone skills through bitter experience and triumph to develop their approach to accumulating wealth?’
The Great Investors is the story of a number of remarkable men: John Templeton, George Soros, Warren Buffett, Benjamin Graham, Philip Fisher, Peter Lynch, Anthony Bolton and John Neff. Whether you’re new to investing, have had success in the markets, or you’re a professional investor or fund manger, you’ll benefit from reading about their proven, and successful, trading philosophies.
The Great Investors will show you how to:
- Be a business analyst rather than a security analyst
- Do your homework and develop a broad social, economic and political awareness
- Control emotion so as not to get swept away by the market
- Be consistent in your approach, even when you have bad years
- See the wood for the trees and not over complicate your portfolio
- Learn from your investing
- Be self reliant, stand aside from the crowd and follow your own logic
- Take reasonable risk