investment treatise on cof, page-14

Persist,

We are all looking for 30% guranteed CAGR returns based on mid-case scenarios!

Trouble is, they are rare and have become more so in the past 6 months.

I will not be re-investing dividends received as part of the upcoming reporting season as I see very little that stands out as being both investment-grade and undervalued.

I don't believe in calling market direction, but the irony is, if you held a gun to my head, I'd say it will continue heading upwards, partly on the global economy not getting any worse, but more on relative undervalution arguments in favour of equities relative to other asset classes, notably bonds and cash.

All of this does not accord well with my investment process that is grounded in a strict instrinsic value framework.

Oh well, that's a quality problem for most to have, I suppose, but being a buyer of Free Cash Flow streams, I don't like the unbrideld anaimal spirits and cheer that drives up the cost of those cash flow streams.

Instead - and I risk being accused as a sort of sick-o for it - I relish the sort of equity market pain and wailing and gnashing of teeth that makes those cash flows streams cheaper.