Thursday, March 26, 2015

Rising Dollar - Threat to Emerging Economies

Hat Tip: BIS

As Fed moves closer to raise interest rates, the dollar denominated debt is coming back to haunt emerging economies as both absolute levels of debt and interest rates on the debt will rise. 
 
 

Friday, March 13, 2015

Warren Buffett On Moats And Millions

Excellent presentation by Jeetay Investments on Moats.

You can read my analysis of Moats and Floats here.
Warren Buffett on Moats
Click on the picture below to access the slides.

Thursday, March 12, 2015

Pretending to Know

Hat Tip: The Big Picture


Moats & Floats: Info Edge (India) Ltd.

Disclaimer: This blogpost draws heavily from the teachings of Prof. Sanjay Bakshi, Warren Buffett and Pat Dorsey.

There are a lot of ways to make money in the stock markets. You can scan the stocks on frequent basis and try to find any anomalies between market pricing and perceived intrinsic value of the company. Then you bet on closing of this gap.

There is another way. A better way, but the one that requires more hard work. In this method, you avoid looking at the markets at first place. You see, if you pick a company by scanning from day’s winners or losers list, your valuation would be colored. This is what is known as Anchor Bias and it will have an adverse effect on your judgement skills. So, you pick a company – a random pick. You go to the website and download last 10 years of annual reports and start going through them one by one.

You don’t have to read all these annual reports cover to cover, you can pretty much focus on just Chairman’s letter and MD&A (a tip I got from Jana’s awesome blog Seeking Wisdom).

The rationale behind going through earlier annual reports is that you should view the business as an unfolding movie, not a still photograph. Also, you want to know how they arrived at their current position in the market today and whether management is aggressive or conservative and delivers on its promises.