Citat från kända värdeinvesterare

Kom på idag att jag för drygt tre år sedan experimenterade med en Youtube-kanal. Gjorde då några korta "filmer/bildpresentationer" och laddade upp. Se några här. Citat nedan tagna från Benjamin Graham, Seth Klarman och Irving Khan. Har du något favoritcitat?

(Edit: Jag är tydligen så tekniskt/IT obegåvad att jag "delat" spellistor istället för tre klipp, men det är ju ändå fredag så det bjuder jag på...)

Study of Market History through Graham and Buffet and Others

Jag råkade på ett intressant dokument här om dagen: Study of Market History through Graham and Buffet and Others

I förordet står det bl.a.:

"Many outstanding investors have been fanatical students of history because history teaches you to place events into perspective, to understand that industries boom and fade; cycle’s repeat and human folly is never-ending. Bill Gross of Pimco (The Fixed Income Money Manager) said that the history books in his office have been a better guide to making money in the bond markets than any financial analysis. Seth Klarman, value investor extraordinaire, has endowed a history chair. Warren Buffett sat for hours in the Columbia University Library reading newspapers—including the ads--from the 1930s to gain a sense of the Great Depression.

Jim Rogers, the peripatetic investor, speaks about the value of studying history as an investor in the foreword to Financial Reckoning Day Fallout (2009) by William Bonner and Addison Wiggin. Jim Rogers: “The only other way (besides visiting countries around the world yourself) to know what is going on is to study history. When I teach or speak at universities, young people always ask me: “I want to be successful and travel around the world; what should I study?” I always tell them the same thing: “Study history.” And they always look at me very perplexed and say, “What are you talking about….what about economics, what about marketing?” “If you want to be successful, “I always say, “You’ve got to understand history. You will see how the world his always changing. You will see how a lot of the things we see today have happened before. Believe it or not, the stock market didn’t begin the day you graduated from school. The stock market’s been around for centuries. All markets have. These things have happened before. And will happen again.”

Dokumentet är ett samlingsdokument innehållandes en hel del läsvärda artiklar där numera legendariska investerare ger sin syn på marknadens utvecklingen, från Ben Grahams syn på marknaden under den stora depressionen till finanskrisen och dess efterdyningar.

Innehållet är som följande och en del känns säkert igen:

Ben Graham July 1932 “Is American Business Worth More Dead than Alive?”
Mr. Dean Witter May 6, 1932 Memorandum
Ben Graham December 17, 1959 Stock Market Warning
Carol Loomis July 1973 Terrible Two-Tier Market
Warren Buffett November 1974 Over-Sexed Guy in a Harem
Ben Graham September 1974 The Renaissance of Value
Warren Buffett August 1979 You Pay a High Price for a Cheery Consensus
Warren Buffett July 1999 Sun Valley Speech/Article on NASDAQ Over-valuation
Warren Buffett December 2001 Follow-up Article on 1999 Speech
Warren Buffett October 17, 2008 Buy America, I Am
Schwed/Biggs Secret to Investing

Har du någon favoritartikel av de ovanstående?

Rekommenderad läsning från Bill Ackman

William A. Ackman, eller Bill Ackman som han oftare kallas, förvaltar Pershing Square Capital. Bill Ackman har förutom som framgångsrik investerare även gjort sig känd för att ta in personer i analysteamet med bakgrund utanför de vanliga finansiella kretsarna.

Han sägs dock ha ett krav, att innan de börjar ska de ha läst följande böcker:

Security Analysis av Benjamin Graham.

The Warren Buffet Way av Robert G. Hagstrom

Confidence Game av Christine Richard

Beating the Street  av Peter Lynch

Quality of Earnings  av Thornton O´Glove

Margin of Safety av Seth Klarman

The Intelligent Investor av Benjamin Graham

One up on Wall Street av Peter Lynch

You Can Be a Stock Market Genius av Joel Greenblatt

The Essays of Warren Buffett av Lawrence A. Cunningham

Fooling Some of the People All of the Time av David Einhorn och Joel Greenblatt


Ovanstående böcker utgör antagligen en mycket solid grund för en person som vill kunna göra framgångsrika investeringar. Naturligtvis under förutsättning att man lyckas anamma en del av det böckerna vill förmedla.

Har du någon favorit bland ovanstående böcker? Finns det någon som du inte alls tycker håller måttet?

Graham om Efficent Market Hypothesis

Bloggaren Lundaluppen har startat en serie inlägg som behandlar boken The Intelligent Investor  skriven av Benjamin Graham. Jag rekommenderar varmt att du tar dig en titt. Läs om inläggen här: Lundaluppen: The Intelligent Investor. Graham är ju allmänt känd som värdeinvesteringens fader och hade en lång karriär. Ett flertal böcker skrevs, varmed ovan nämnda och Security Analysis antagligen är de mest kända.  

Utöver böcker skrev Benjamin Graham också en hel del andra artiklar, höll tal samt naturligtvis även undervisade i ämnen relaterade till ekonomi och investeringar. En hel del av hans artiklar publicerades i ansedda Financial Analysts Journal och finns kvar i deras arkiv än för den som är intresserad.

Benjamin Graham avled 1976 vid 82 års ålder men var tämligen aktiv även de sista åren av sitt liv.

Under 60-talet växte en teori om aktiemarknaden som brukar refereras till som Efficent Market Hyphotesis. Kortfattat så handlar den om att marknaden alltid är rätt prissatt utifrån tillgänglig information. Marknaden är med andra ord effektiv. Denna syn på aktiemarknaden fick allt starkare fotfäste under framförallt 70-talet d.v.s. mot slutet av Grahams karriär. Graham själv verkade ödmjuk inför att det fanns olika vägar för att lyckas på "marknaden" för olika personer och stängde därmed inga dörrar för andra även om han själv förordade att man köpte det som bedömdes vara så att säga undervärderat. Man utnyttjar med andra ord det glapp mellan värde och pris som anses föreligga.

"Do those things as an analyst that you know you can do well, and only those things. If you can really beat the market by charts, astrology, or by some rare and valuable gift of your own, then thats the row you should hoe. If you´re really good at picking the stocks most likely to succeed in the next 12 months, base your work on that endeavor. If you can fortell the next important development in the economy, or in technology, or in consumers preferences and gauge its consequences for various equity values, then concentrate on that particular activity. But in each case you must prove to yourself by honest, no-bluffing self-examination and by continuous testing of performance, that you have what it takes to produce worthwile results."

Just Efficent Market Hyphotetis är extra intressant då den ofta sätts i motsattsförhållande till s.k. värdeinvestering. Jag tänkte det tillika då kunde vara intressant att se vad Benjamin Graham hade för tankar kring denna syn bl.a. så sent som 1974. 

"I do want to use an instance here in connection with a brief discussion of a recently launched academic theory about the stock market, which could have a great practical importance if it coincided with reality. This is the hypothetis of the efficent market. In its extreme form it makes two declerations: (1) The price of nearly every stock at nearly all times reflects whatever is knowable about the companys affairs; hence no consistent profits can be made by seeking out and using additional information, including that held by insiders. (2) Because the market has complete or atleast adequate information about each issue, the price it registers are therefore "correct", "reasonable" or "appropiate". This would imply that it is fruitless, or atleast insufficiencly rewarding for security analysts to look for discrepancies between price and value.

I have no particular quarrel with decleration one, though assuredly there are times when a researcher may unearth significant information about a stock, not generaly known and reflected in the price. But I deny emphatically that because the market has all the information it needs to establish a correct price the prices it actually registers are in fact correct.

Descartes summed up the matter more than three centuries ago, when he wrote in his Discours de la Methode "Ce nést assez d´avoir l´esprit bon, mais le principal est de l´appiquer bien". In English "It is not enough to have good intelligence" - and I add "enough information" - "the principle thing is to apply it well."

A conversation with Benjamin Graham

Financial Analysts Journal är en riktig guldgruva med intervjuer, artiklar et.c. från 1945 och till dags datum. En del artiklar är fria att läsa andra får man tillgång till mot en avgift.

Nedan följer en intervju med Benjamin Graham September/Oktober-numret från 1976.

"In the light of your 60-odd years of experience in Wall Street what is your overall view of common stocks?

Common stocks have one important characteristics and one important speculative
characteristic. Their investment value and average market price tend to increase
irregularly but persistently over the decades, as their net worth builds up through the reinvestment of undistributed earnings--incidentally, with no clear-cut plus or minus response to inflation. However, most of the time common stocks are subject to irrational and excessive price fluctuations in both directions, as the consequence of the ingrained tendency of most people to speculate or gamble--i.e., to give way to hope, fear and greed.


What is your view of Wall Street as a financial institution?

A highly unfavorable--even a cynical--one. The Stock Exchanges appear to me chiefly as a John Bunyan type of Vanity Fair, or a Falstaffian joke, that frequently degenerates into a madhouse--"a tale full of sound and fury, signifying nothing." The stock market resembles a huge laundry in which institutions take in large blocks of each other's washing--nowadays to the tune of 30 million shares a day--without true rhyme or reason. But technologically it is remarkably well-organized.


What is your view of the financial community as a whole?

Most of the stockbrokers, financial analysts, investment advisers, etc., are above average in intelligence, business honesty and sincerity. But they lack adequate experience with all types of security markets and an overall understanding of common stocks--of what I call "the nature of the beast." They tend to take the market and themselves too seriously. They spend a large part of their time trying, valiantly and ineffectively, to do things they can't do well.


What sort of things, for example?

To forecast short- and long-term changes in the economy, and in the price level of
common stocks, to select the most promising industry groups and individual issues--
generally for the near-term future.


Can the average manager of institutional funds obtain better results than the Dow
Jones Industrial Average or the Standard & Poor's Index over the years?

No. In effect, that would mean that the stock market experts as a whole could beat
themselves--a logical contradiction.


Do you think, therefore, that the average institutional client should be content with the DJIA results or the equivalent?

Yes. Not only that, but I think they should require approximately such results over, say, a moving five-year average period as a condition for paying standard management fees to advisors and the like.


What about the objection made against so-called index funds that different investors have different requirements?

At bottom that is only a convenient cliche or alibi to justify the mediocre record of the past. All investors want good results from their investments, and are entitled to them to the extent that they are actually obtainable. I see no reason why they should be content with results inferior to those of an indexed fund or pay standard fees for such inferior results.

Turning now to individual investors, do you think that they are at a disadvantage
compared with the institutions, because of the latter's huge resources, superior
facilities for obtaining information, etc.?

On the contrary, the typical investor has a great advantage over the large institutions.


Why?

Chiefly because these institutions have a relatively small field of common stocks to
choose from--say 300 to 400 huge corporations--and they are constrained more or less to concentrate their research and decisions on this much over-analyzed group. By contrast, most individuals can choose at any time among some 3000 issues listed in the Standard & Poor's Monthly Stock Guide. Following a wide variety of approaches and preferences, the individual investor should at all times be able to locate at least one per cent of the total list--say, 30 issues or more--that offer attractive buying opportunities.

What general rules would you offer the individual investor for his investment policy
over the years?

Let me suggest three such rules:

(1) The individual investor should act consistently as an investor and not as a speculator. This means, in sum, that he should be able to justify every purchase he makes and each price he pays by impersonal, objective reasoning that satisfies him that he is getting more than his money's worth for his purchase--in other words, that he has a margin of safety, in value terms, to protect his commitment.

(2) The investor should have a definite selling policy for all his common stock commitments, corresponding to his buying techniques. Typically, he should set a reasonable profit objective on each purchase--say 50 to 100 per cent--and a maximum holding period for this objective to be realized--say, two to three years. Purchases not realizing the gain objective at the end of the holding period should be sold out at the market.

(3) Finally, the investor should always have a minimum percentage of his total portfolio in common stocks and a minimum percentage in bond equivalents. I recommend at least 25 per cent of the total at all times in each category. A good case can be made for a consistent 50-50 division here, with adjustments for changes in the market level. This means the investor would switch some of his stocks into bonds on significant rises of the market level, and vice-versa when the market declines. I would suggest, in general, an average seven- or eight-year maturity for his bond holdings.


In selecting the common stock portfolio, do you advise careful study of and selectivity among different issues?

In general, no. I am no longer an advocate of elaborate techniques of security analysis in order to find superior value opportunities. This was a rewarding activity, say, 40 years ago, when our textbook "Graham and Dodd" was first published; but the situation has changed a great deal since then. In the old days any well-trained security analyst could do a good professional job of selecting undervalued issues through detailed studies; but in the light of the enormous amount of research now being carried on, I doubt whether in most cases such extensive efforts will generate sufficiently superior selections to justify
their cost. To that very limited extent I'm on the side of the "efficient market" school of thought now generally accepted by the professors.


What general approach to portfolio formation do you advocate?

Essentially, a highly simplified one that applies a single criteria or perhaps two criteria to the price to assure that full value is present and that relies for its results on the performance of the portfolio as a whole--i.e., on the group results--rather than on the expectations for individual issues.


Can you indicate concretely how an individual investor should create and maintain his common stock portfolio?

I can give two examples of my suggested approach to this problem. One appears severely limited in its application, but we found it almost unfailingly dependable and satisfactory in 30-odd years of managing moderate-sized investment funds. The second represents a great deal of new thinking and research on our part in recent years. It is much wider in its application than the first one, but it combines the three virtues of sound logic, simplicity of application, and an extraordinarily good performance record, assuming--contrary to fact--that it had actually been followed as now formulated over the past 50 years--from 1925 to 1975.


Some details, please, on your two recommended approaches.

My first, more limited, technique confines itself to the purchase of common stocks at less than their working-capital value, or net-current-asset value, giving no weight to the plant and other fixed assets, and deducting all liabilities in full from the current assets. We used this approach extensively in managing investment funds, and over a 30-odd year period we must have earned an average of some 20 per cent per year from this source. For a while, however, after the mid-1950's, this brand of buying opportunity became very scarce because of the pervasive bull market. But it has returned in quantity since the 1973-74 decline. In January 1976 we counted over 300 such issues in the Standard & Poor's Stock Guide--about 10 per cent of the total. I consider it a foolproof method of systematic investment--once again, not on the basis of individual results but in terms of the expectable group outcome.


Finally, what is your other approach?

This is similar to the first in its underlying philosophy. It consists of buying groups of stocks at less than their current or intrinsic value as indicated by one or more simple criteria. The criterion I prefer is seven times the reported earnings for the past 12 months. You can use others--such as a current dividend return above seven per cent or book value more than 120 percent of price, etc. We are just finishing a performance study of these approaches over the past half-century--1925-1975. They consistently show results of 15 per cent or better per annum, or twice the record of the DJIA for this long period. I have every confidence in the threefold merit of this general method based on (a) sound logic, (b) simplicity of application, and (c) an excellent supporting record. At bottom it is a technique by which true investors can exploit the recurrent excessive optimism and excessive apprehension of the speculative public."

Vid tidpunkten för denna intervju har Benjamin Graham, som är den s.k. värdeinvesteringens fader, mer erfarenhet från investeringar än vad jag själv ens någonsin kommer att tillägna mig under hela min livstid. Han har ett otal böcker bakom sig, inte minst "värdeinvesterings-bibeln" The Intelligent Investor, samt har som investerare sett en mängd upp och nedgångar. En i mitt tycke mycket intressant intervju väl värd att läsa och begrunda.

Väcker intervjun några tankar hos dig?

The Intelligent Investor

The Intelligent Investor av Benjamin Graham ses av många som "Bibeln" inom värdeinvestering. Många spaltmeter har skrivits om denna bok och säkerligen har många också lagt ned otaliga timmar på att läsa den, flera gånger om.

Det är svårt att säga annat än att The Intelligent Investor är en bok som alla som vill investera i aktier utifrån ett värdeinvesteringsperspektiv bör ha läst. Låt mig börja med att citera huvudpunkterna av vad Graham vill förmedla i sin bok.

"- A stock is not just a ticket symbol; it is an ownership interest in an actual business with an underlying value that does not depend on its share price.

- The market is a pendelum that forever swings between unsustainable optimism (which makes stocks to expensive) and unjustifies pessimism (which makes them to cheap). The intelligent investor is a realist who sells to optimists and buys from pessimists.

- The future value of every investment is a function of its present price. The higher the price you pay, the lower your return will be.

- No matter how carefull you are, the one risk no investor can ever eliminate is the risk of being wrong. Only by insisting on a margin of safety can you minimize your odds of error.

- The secret to your financial success is inside yourself. In the end, how your investments behave is much less important than how you behave."

Graham skiljer också på två typer av investerare. Den s.k. defensiva investeraren och den entreprenöriella investeraren. Den entreprenöriella utmärks bl.a. av, som Graham skriver, "Buying in low markets and sellling in high markets" samt "Buying carefully chosen growth stocks." Den entrepröniella investeraren kan nå högre avkastning än den defensiva men det kräver mycket mer tid och energi.

Angående att "tima marknaden" skriver Graham; "There is one aspect of "timing" philosophy which seems to have escaped everyones notice. Timing is of great psychological importance to the speculator because he wants to make his profit in a hurry. The idea of waiting a year before his stock moves upp is repugnant to him. But a waiting period, as such, is of no consequence to the investor."

Graham skriver också om skillnaden om spekulerare och investerare; "The speculators primary interest lies in anticipating and profiting from market fluctuations. The investors primary interest lies in acquiring and holding suitable securities at suitable prices. Market movements are important to him in a practical sense, because they alternately create low price levels at which he would be wise to buy and high price levels at which he certainly should refrain from buying."

Samt att det viktigaste för de flesta kanske inte är att enbart köpa då det är som billigast (pricka bottnar) utan att undvika att köpa "dyrt".

"It is far from certain that the typical investor should regularly hold off buying until low market levels appear, because this may involve a long wait, very likely the loss of income and the possible missing of investment opportunities. On the whole it may be better for the investor to do his stock buying whenever he has money to put in stock, except when the general market level is much higher than can be justifies by standards of value."

Det var några valda axplock. Hoppas du får tillfälle att läsa den någon gång, eller det kanske du redan har gjort?

Finn boken hos Adlibris; The Intelligent Investor

Återköp av aktier

Ett återköp av egna aktier är i princip ett sätt att dela upp tårtan på ett färre antal. Man ska m.a.o. som aktieägare få mer av framtida vinster utan att behöva köpa fler andelar.

Tittar vi på det grundläggande förhållandet så när ett bolag gör vinst kan bolaget i princip välja på tre saker:

1) Investera pengarna.
2) Dela ut pengar till sina ägare.
3) Återköp av egna aktier.

Investera pengar ska ett bolaget i princip göra med så stor del som det är rimligt att man kan få god avkastning ifrån. T.ex. H&M hinner med att analysera, utvärdera, bedöma nya marknader och bygga upp logistikkedjor, butiker et.c. i en takt som tillåter återinvestering av ca 10-20% av vinsten årligen. För att växa med lönsamhet så är det ungefär den nivån man klarar av. De pengar av vinsten som man därför inte "kan" förvalta bra på detta sätt delar man istället ut till sina ägare. Så långt allt väl.

Tittar vi på återköp så är de också logiska. Man använder en del av vinsten för att öka framtida vinster per aktie et.c. för att gynna sina ägare och låta sina ägare få ut mer av "kakan" utan att själva behöva köpa mer.

Problemet med återköp är dock flera.

För det första kan man som investerare förledas att tro att det går allt bättre och bättre för bolaget i fråga eftersom vinst och utdelning per aktie ökar. Ett exempel är AstraZeneca. Det går inte alls bättre och bättre för AstraZeneca. Tvärtom kämpar man för att behålla det man har, men i och med att man använder det man har till återköp så "dopas" resultaten och vinst och utdelning per aktie ökar. Detta högre resultat per aktie betyder dock inte att affärsverksamheten i sig går bättre och bättre. Något man bör vara medveten om.

För det andra så visar tydligen de flesta historiska exempel att bolag är ganska kassa på att göra återköp. Ofta gör man det när kurserna är höga, men håller igen när kursen är låg (då det egentligen vore mest rationellt att göra återköp). Anledningen kan vara att i olika konjunkturtrender så är det lättare/svårare att göra dem beroende på psykologi samt egen finansiell styrka.

För det tredje så utgör återköp sällan bolagens kärnverksamhet och man kan ifrågasätta om det verkligen är det man ska lägga ned energi på. Som investerare kanske man investerat i en klädbutik för att de tillverkar och säljer kläder som få andra, inte för att de ska bestämma över när man ska köpa mer av den egna aktien. Det vill man kanske helst avgöra själv.

Summa summarum så är jag personligen inte en stor beundrare av återköp, även om jag förstår hur det både i teorin och praktiken kan vara värdeskapande. Jag tar heller inte kategoriskt avstånd från bolag som gör återköp, men jag tycker att det ibland är ett tveksamt sätt att använda sina pengar på och när det sker så kan det vara bra att titta närmare på vilka motiv bolaget må hända ha. Det är ju ingen ovanlighet att återköp är mest frekventa i bolag där ledningspersoner fått många optioner.

I mina funderingar är jag naturligtvis inte ensam. Jag är ju påverkad av sådant jag bl.a. läst. Andra investerare som också har en del tveksamma tankar kring just återköp är kända värdeinvesterare så som Warren Buffett och Benjamin Graham.

Hur tänker du kring återköp av aktier?