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Oct 13-20, '22

  • Idea Generation:

    • VIC: write ups

    • Value Line

    • Sum Zero

    •  ​

  • Mohnish Pabrai Q&A with Indiana Univ.  (Apr 1, 2021)

    • Shipping: cyclical, watch for arbitrage opportunities when company valuations are substantially below liquidation values (company: Frontline)

    • "Every sell decision is an investment mistake"

    • "there are no billionaires among people who are shorting stocks": identifying shorting companies is not difficult, but timing of it is extremely difficult

    • Anything above 15 P/E is high to invest; lower probability of multi-bagger company ​

    • Investment Checklist:

      • is this a biz that can be effected by cheaper labor from overseas?​

      • is the business getting better, is the moat getting larger?

      • how much of the business is autopilot (sitting CEO with feet up) - Coke, Costco, Visa, Mastercard, etc.

      • does the business  

  • Mohnish Pabrai Q&A with Boston College (Nov 19, 2013)

    • Check out largest positions of major value investors and their 13F filings​​​​​​

  • Mohnish Pabrai Q&A with CFA Mexico (August 17, 2022)​​​​​

    • If the business is getting better, continue to hold the stock even though its price is above its intrinsic value.​

    • As long as the moat gets wider, the business is profitable, don't sell a stock

    • Long lasting / enduring moats are hard to predict in companies at early stage; the odds are against you.

    • About 4-5% of companies generate almost all the returns in the market; that is why indexing for average investors makes sense.

    • When picking a stock as an individual investor, the odds are against us.

    • If margin of safety is great enough (mis-priced securities) you can even invest in high inflation countries such as Turkey

    • Spotify link 

  • ​Mohnish Pabrai Q&A with Mis Propias Finanzas (September 20, 2022)​​​​​​

    • Global investment opportunities:

      • Turkey, despite high inflation focus on companies vs. macro economics

      • Try to focus on how businesses do in long-term not how countries do in long-term​

      • 95% of companies don't do well in Turkey, so buying ETF does not help; better to drill down on companies with TL costs, and Euro revenues (eliminating risk of inflation) 

    • If he had to select one person to manage his own money, it would be Li Lu.​

    • Spotify link​

  • ​​Mohnish Pabrai Q&A with Ironhold Capital (September 16, 2022)​​​​​​​

Oct 12, '22

  • Nomad Investment Partnership: Nick Sleep and Qais Zakaria's Letters (download)

  • Mohnish Pabrai Q&A with Columbia Business School (March 18, 2021)​

    • Focusing on 10X baggers

      • Criteria: better chance to focus on 100 - 300Mil USD market cap​

    • To get above market performance, need to have concentrated (not diversified portfolio)

    • Heads I win, tails i don't lose (or don't lose much) - margin of safety, limiting downside risk

    • NVR: capital light business, profitable business for long term, consistent buybacks to create shareholder wealth

    • Recycle businesses (funeral businesses): all biz die like nature, companies that work with unwanted stuff/inventories etc. will always survive. For example funeral services and recurring revenue structure is beautiful. Others: TJ Max, eBay, etc.

Oct 6, '22

  • Chinese Stocks: A vs. B shares

    • "A" shares: for Chinese citizens; traded in local currency yuan; mainly companies trading in Shangai and Shenzen stock exchanges. 

    • "B" shares: traded in HKD on Shenzen and in USD on Shangai exchanges.

    • "H" shares: companies incorporated in China, but listed in Hong Kong stock exchange and denominated in HK dollars.

    • "N" shares: chinese companies incorporated outside the mainland and listed on NYSE/Nasdaq/etc/ Majority of revenue or assets must be derived from China. ADRs and H-shares and red chips are also sometimes called N-shares.

​

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Oct 4 '22

Oct 4, '22

  • Indian Index & ETFs

    • Two indexes: NIFTY 50 & BSE Sensex (this is a better option to take as a benchmark)

    • INDA: by Blackrock, with high liquidity, +100 Co's; Expense: 0.65%; AUM: ~$4 Bil

  • Chinese​ Indices

    • SSE Index: Shanghai Stock Exchange; all A & B shares/stocks; ~1800 companies

    • HSI Index: Hong Kong Hang Seng Index; ~2500 companies​

    • SZI Index: Shenzen; ~2200 companies

    • CSI Index: Top ~300 companies by market capitalization traded on both Shanghai (SSE) and Shenzhen (SZSE) exchanges

    • CHINEXT Index: Largest and most liquid 100 companies; focusing on tech startups and emerging industries (90% are high-tech)

    • MSCI China Index: large and mid cap across China A/H/B shares + Red chips + foreign listings (e.g. ADRs). With 717 constituents, the index covers about 85% of this China equity universe. 

  • Chinese ETFs​

    • MCHI: Blackrock iShares MSCI China ETF; benchmark is MSCI china index; tracking total market of ~620 large & mid-size stocks; Expense: 0.57%; AUM: ~$7 Bil

    • FXI: Blackrock iShares; benchmark is FTSE 50 china index; 50 largeest cap stocs trading in Hong Kong exchange; Expense: 0.74%; AUM: ~$5 Bil

    • GXC: State Street; similar to MCHI but benchmarking S&P China BMI Index; ~1700 stocks; Expense: 0.54%; AUM: ~$5 Bil

    • ASHR: DWS Xtracker tracks CSI 300 index; largest 300 companies; Expense: 0.65%; AUM: ~$3 Bil

  • U.S. Indices

    • S&P 500: largest 500 companies

    • Dow Jones (DJIA/ or DOW): largest 30 companies; blue-chips & industrials (nowadays too narrow in my opinion)

    • NASDAQ: large and small ~3000 companies; heavily technology focused

    • Long Term Market Strategy: S&P 500 

  • U.S. S&P500 Index & ETFs​

    • Largest ETFs tracking S&P 500 are IVV (Blacrock), VOO (Vanguard), SPY (State street bank)​

    • IVV has largest volume, IVV & VOO have lowest fees (0.03%)​​

    • However, VOO is the transparent company; best long-term play on S&P500 is VOO

  • Long-term portfolio strategy:

    • 85% VOO (U.S. Market)

    • 12% MCHI (Chinese market)

    • 3% INDA (Indian market)

    • Preferably dollar cost averaging on a monthly basis​​

SEP 26, '22

  • Buy the dip investing strategy is not working during major downturns (WSJ)

    • The strategy: buy index after 1% daily decline, ride the momentum and sell.

    • It worked after 2008 and after 2020 crises, but now during downturn it does not

    • Instead of rebounding after a tumble, stocks have continued to fall, burning investors who stepped in to buy shares on sale. The S&P 500 has dropped 1.2% on average this year in the week after a one-day loss of at least 1%, according to Dow Jones Market Data. That is the biggest such decline since 1931. ​

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