Portfoliomanagement
Bill Miller himself once said: “This is a brutal business, success equals survival. If you have survived, you will have succeeded”. We have said it a little differently since 1988: to finish first, you must first finish. Mr. Miller, famous for his 15-year streak of beating the S&P 500, has announced that he will step down as co-manager of the Legg Mason Value Trust in April 2012. Is Mr. Miller’s rise and subsequent fall a matter of genius becoming overconfidence or simple probability theory playing out – as per Taleb? Not knowing the inside workings of Legg Mason, no one can really claim to know the answer. To help us think about it, we collect several links inside.
Farallon Capital’s Tom Steyer is so secretive that even a more “politically-minded” profile seems like a good excuse to collect links about him and Farallon. Mr. Steyer was one of Bob Rubin’s traders at Goldman Sachs in his famed risk-arbitrage desk from the mid-1970′s to the late-1980′s (along with other famed managers such as Eddie Lampert, Daniel Och and Richard Perry). We have a few links and videos about Mr. Steyer inside.
A New Yorker article called “The Mark of a Masterpiece” is quite an enjoyable reading, particularly after watching “Who the #$&% Is Jackson Pollock?”. While 99.9% of the articles written on this subject will basically repeat the same story, the author goes a few steps beyond and provides a great example of what investigative work is. The similarities between the job description of an analyst and that of an investigative reporter have been mentioned several times in internal postings and discussions, but we’ve also dealt with it here at Buysiders.com. Quotes, comments and links inside.
While researching for a future post about one of his Goldman Sachs’ “alumni”, we’ve had the pleasure to re-read Bob Rubin’s excellent commencement speech at Harvard in 2001. We’ve alluded to it in two previous Buysiders posts: “No one would listen”, in March 2010 and the first post with IP report excerpts, the one on Risk Management. A bit over ten years have passed, but these are timeless concepts.
Very good event as usual. Jim Chanos was a blast with a presentation on Solar and Wind power, but the highlight so far was the presentation by a student who won the first Ira Sohn Investment Case Contest. The winner presented his long case on Bridgepoint Education, already up 12% on the news. Sure, the [...]
“The Most Important Thing”, a book by Oaktree’s Howard Marks, was published last week in print (it has been out on Kindle for a while) and we’d like to tackle it soon. The Dealbook article has a quick Q&A with Mr. Marks, but much more useful is the link they’ve provided to all the memos Mr. Marks has written.
We don’t have Baupost Capital’s full 2010 letter, but these excerpts are still very interesting. Seth Klarman’s straight talk is always refreshing. Bits on Cash as strategic asset (being able to pull triggers in the midst of panic), “Short-termism” and how that affects everything, and Edge are particularly interesting.
NYT’s Dealbook linked yesterday to a CNBC interview with Bill Ackman of Pershing Square. A little more digging revealed other sections with him – it was a “Harvard Business School special” of sorts, and as such featured other high-profile alumni and professors such as Michael Porter. While each video has back-and-forth interaction with all participants, we highlight a few of Mr. Ackman’s “moments” inside.
Bill Nygren of Oakmark Funds just published his letter commenting on the 2000 decade, and it’s a very interesting (and concise) exercise in expectations management. Leaving aside comments on his fund’s performance or musings on the “ideal” hurdle rate for a manager’s performance, the highlight is this: in the 40 quarters that made up the last decade, his flagship fund “only” beat the self-imposed hurdle (make money and beat the S&P 500 by more than 1%) in 8 of the 40 quarters – and still beat the S&P 500 by a large margin in the period. To finish first, first you must finish.
Long interview with two of IP’s partners, Cristiano Fonseca Filho and Fred Trigueiro. Quite informal, the interview goes through IP’s pioneering history in the Brazilian capital market and shows how we apply some of the most important aspects of our culture in the day to day: Ethics, Discipline and Patience, Independence… We’ve obtained permission from Exame to translate and publish the interview and here it is.
