Jeff Auxier on the Value of Cumulative Research

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Jeff Auxier on the Value of Cumulative Research

Jeff Auxier on the Value of Cumulative Research

Play Quizzes 4

Jeff Auxier, Auxier Focus Inv (MUTF:AUXFX)– ‘Value of Cumulative Research (Over Time)’

Jeff is the founder and portfolio manager for Auxier.

This Too Value Fund Explains Why Turkey Is Ripe For Investment Right Now

TurkeyThe Talas Turkey Value Fund returned 9.5% net for the first quarter on a concentrated portfolio in which 93% of its capital is invested in 14 holdings. The MSCI Turkey Index returned 13.1% for the first quarter, while the MSCI All-Country ex-USA was down 5.4%. Background of the Talas Turkey Value Fund Since its inception Read More

* Influences:

o Call to Buffett in 1982

o Graham – ‘The Intelligent Investor’, SEC Filings, Annual reports

o Templeton – ‘The Humble Approach’

o Fisher – ‘Conservative Investors Sleep Well’

o Robert Pamplin – Pres. of Georgia Pacific (Jeff’s first job was mowing for him)

* Frame work to endure

o Rational business approach

o Margin of Safety

o Double play (dividends + depressed price) vs. torpedo

* Investing – craft of the specific

o Focus on the important and knowable

o Determining odds of outcomes

o Price dictates capital allocation

o Get away from Wall Street

o Long term focus is invaluable

o Ego & emotion are the enemy (Isaac Newton & South Sea Bubble)

o Compounding most underappreciated concept

* Understand accounting – the language of business

o Importance of ledgers

o lesson from Pamplin – your brain is the calculator

o Ben Franklin – the idea of a ‘moral ledger’ as well

* Misperception of risk

o Buffett quote – risk is not knowing what you are doing….

o Carlos Slim quote – I never take risk

o In 2009, the distressed debt market had 50% loss protection (1930’s worst case was 5%)

o Diversification does not work when there is easy money and assets are inflated

o Research the entire capital structure (could go to 0)

o Adequate compensation for risk taken

o Risk of easy money bubbles

o Avoid hottest companies in hottest industries

o Want inspired management in an uninspired industry

* Crisis is Opportunity

o Since 1947, recessions occur less than 5% of time

o 91′-98′ Small Banks were #1 asset class

* Q&A

o Best ideas now?

* Tesco at less than real estate value

o How many stocks do you hold?

* Normally 20-30

o When should you sell?

* At estimate of full value

o What do you like about Avon?

* Going into emerging markets, where they will have more consumption

Value Investor Conference: Omaha, Nebraska – May 4th, 2012

Dustin Hunter, SunRift Capital Partners (www.sunriftcp.com)

(These notes are to the best of my recollection.)

Updated on

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