The best investments I have made over the years tend to be the ones where the investment case is really simple and obvious, requiring only basic common sense and at best secondary-school arithmetic. In almost every case, the opportunity presented itself in a wider market downturn and the main thing I had to overcome to profit … More Opportunities of a Life Time?
Back in Sep 2015, I wrote this article outlining the investment case for SJM Holdings. The story is simple: the Macau gaming revenue had more than halved by Sep 2015 from a peak in early 2014 because of the corruption crackdown in China, sending Macau gaming stocks crashing more than 70% in some cases; the long-term fundamentals … More SJM Holdings: Hanging On or Cashing Out?
After a long bull market, most investors are sitting on healthy gains and a fair few are probably twiddling their thumbs wondering what to do next, if anything. There is plenty of talks about an imminent crash. CAPE valuations are high, very high. VIX is low, very low. The only reasonable way to justify current … More Hanging to Your Gains in a Lofty Market
The June 30 Quarterly Report from Platinum Asset Management’s European Fund contains some great insights and here’s an excerpt that I find particularly interesting. “Consider for a moment our own experience, as Australians, participating in this economy over the last thirty-odd years: We have enjoyed a period of unprecedented economic stability. We have not experienced … More How it Feels to Live in a Current Account Surplus / Deficit Economy
I bought into an ETF replicating the MSCI Russia Capped Index back in April 2014 on the basis of the Russian market’s low Cyclically Adjusted Price Earnings ratio (CAPE), which was around 5 at the time and the lowest in the world. (For more on the rationale of CAPE investing, see this post.) After three frustrating … More My Russian Value Trap
It’s been 10 years since I started practising Value Investing and it’s time to do a little introspection and write down a few reflections. I hope these reflections can serve as a memory aid to my future self and be of value to others as well. I have always had an affinity to investing because of … More Reflections on Tens Years of Value Investing
The book A Short History of Financial Euphoria by John Kenneth Galbraith provides a succinct description of the common denominators of financial euphoria, illustrated beautifully with actual euphoric episodes through the ages. The following are some key points to help us recognise such speculative episodes: Uniformly in all financial euphoria there is the thought that … More A Mental Model of Financial Euphoria