A “Buffet Style” Approach to ER
On the buy side what mutual funds and on the sell side ER divisions are the most focused on “Buffet Style” in their research (e.g. reading annual reports rather than quantitative [esp. Modern Portfolio Theory based] modeling)? Additionally, do you know of any mutual funds or buy side ER divisions that combined this with global macro investing?
What kind of buffet are you interested in? Chinese can be good, but can also end in the squirts. Really, I'm happy as long as they have shrimp.
MPT is largely full of shit. A few notches above EMH on the legitimacy ladder, but still quite lacking.
Buyside and equity research are somewhat of an oxymoron. Funds obviously have research analysts, but typically ER is spoken of from a sell-side (publishing) perspective.
There are plenty (1000's) of plain vanilla mutuals that do the type of research you describe, but "global macro" almost by definition will have a heavy quant element due to the derivative strategies employed by such funds.
As for Mr. Buffett, you could be a billionaire too if GS called you up with the deal he got. Or if you got to go on TV at your leisure. Certainly he's had brilliant moments, but these days he just talks his own book. And who can blame him?
The way he handles the whole GS thing is an entirely different story, I agree. Interesting to see that Munger seems to disagree with him on this one.
As I said, he's had brilliant moments and is obviously a pioneer, but these days (that includes long before the GS deal) he shows up, says some hokey saying like, "when the snake falls in love with the spaghetti, it's time to buy a new hat", talks his own book, lets self-fulfilling prophecy work it's magic.
It's a brilliant model really.
Buffett has a huge information edge.
In projecting future performance of companies (e.g. earnings), industries (e.g. growth), or even economies (e.g. unemployment), he has actual raw data before most people from a variety of companies.
IMO, Buffett is more like a Private Equity investor. In that sense, he's closer to activist hedge funds.
His true secret: incredibly cheap cost of capital by investing the cash (float) from his massive insurance/reinsurance operations. He doesn't need the capital markets.
Hold it till you turn 60... I'm sure that'll make you a great investor...
Why seek Buffet-style research, when Buffet would NEVER use such materials?
Start with this:
http://www.amazon.com/Intelligent-Investor-Book-Practical-Counsel/dp/00…
http://www.amazon.com/Interpretation-Financial-Statements-Benjamin-Grah…
http://www.amazon.com/Security-Analysis-Classic-1934-GRAHAM/dp/00702449…
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