Money and Finance
From The Small-Cap Advantage: How Top Endowments and Foundations Turn Small Stocks into Big Returns:
- A Rule Of Intuition...
From Thinking, Fast and Slow: It is wrong to blame anyone for failing to forecast accurately in an unpredictable world. However, it seems fair to blame professionals for believing they can succeed in an impossible task. Claims for correct intuitions...
- The Linkage Between Returns-on-capital And Competitive Advantage...
From The Small-Cap Advantage: How Top Endowments and Foundations Turn Small Stocks into Big Returns: The small-cap manager should attempt to understand the linkage between returns-on-capital and competitive advantage. The latter drives the former, but...
- Graham And Dodd Quote
From Security Analysis, 1940 edition: "Analysis is concerned primarily with values which are supported by the facts and not with those which depend largely upon expectations. In this respect the analyst’s approach is diametrically opposed to that of...
- Seth Klarman Interview At The Tef Endowment Management Seminar In July 2008
An excerpt that I found very interesting: …one of the things that’s vastly different from being an analyst to running your own fund — and I can’t emphasize this enough — is that they comprise incredibly different skills. The inability to think...
- Mark Sellers: Take Advantage When Good Companies Come To Market
As it turned out, Google’s stock was incredibly cheap at its IPO price of $85. Over the following year, the company’s actual (not estimated) earnings turned out to be $4.27 per share. This meant that it was priced at just 19.9 times its forward earnings...
Money and Finance
The temperament needed to be a great research analyst...
From The Small-Cap Advantage: How Top Endowments and Foundations Turn Small Stocks into Big Returns:
The temperament needed to be a great research analyst is similar to what is required for investigative journalism. A genuine curiosity and interest in business is required. A nose for a story also helps. By digging deeper and following intuition, a good analyst is able to gather certain relevant facts often overlooked by lazy competitors. An important trait of a good analyst is being able to define the limits of understanding. This self-awareness comes only with experience. Often an analyst without this ability genuinely professes an extensive understanding of a specific company or industry. But in reality, this knowledge may be woefully lacking when compared with other analysts. The analyst may suffer from what is known as the Dunning-Kruger effect, where a person’s own inexperience prevents recognition of that inexperience. Only through improved skill and experience can an analyst enhance the metacognitive competence that allows for the recognition of the limits of ability. Reading competitive research and talking to industry contacts after a thesis has been formed can help analysts get a sense for how much understanding is enough.
- A Rule Of Intuition...
From Thinking, Fast and Slow: It is wrong to blame anyone for failing to forecast accurately in an unpredictable world. However, it seems fair to blame professionals for believing they can succeed in an impossible task. Claims for correct intuitions...
- The Linkage Between Returns-on-capital And Competitive Advantage...
From The Small-Cap Advantage: How Top Endowments and Foundations Turn Small Stocks into Big Returns: The small-cap manager should attempt to understand the linkage between returns-on-capital and competitive advantage. The latter drives the former, but...
- Graham And Dodd Quote
From Security Analysis, 1940 edition: "Analysis is concerned primarily with values which are supported by the facts and not with those which depend largely upon expectations. In this respect the analyst’s approach is diametrically opposed to that of...
- Seth Klarman Interview At The Tef Endowment Management Seminar In July 2008
An excerpt that I found very interesting: …one of the things that’s vastly different from being an analyst to running your own fund — and I can’t emphasize this enough — is that they comprise incredibly different skills. The inability to think...
- Mark Sellers: Take Advantage When Good Companies Come To Market
As it turned out, Google’s stock was incredibly cheap at its IPO price of $85. Over the following year, the company’s actual (not estimated) earnings turned out to be $4.27 per share. This meant that it was priced at just 19.9 times its forward earnings...