cho, page-51

Lessons learnt in 2008.


Becoming a better investor comes with time. The right framework (Fisher) in collaboration with the right mindset (Graham/Buffett) is the focus for 09.
Market moods do really take a hold when irrationality is present, both at the frantic and manic depressive states. Babcock was one case in point. Luckily (and for sane purposes - when you can smell that *something* appears to be hitting the fan) an exit at entry point (back in 04/05) was put in place and got out. In retrospect, touching BNB was a mistake.
One case in point; that we must stick to our circle of what we know. I didnt. I learn.

Companies that **DIDNT** participate in the frenzy are the organisations that have a significant moat about them, the kind of business that year in year out you want to be in, regardless of environment. Warren is right when he says he "doesnt care about the macro stuff" - so true. Makes no difference in the short term what credit spreads/terms/rates (you get the point) are...
In this case, think AGK, FGL, RHC, CSL, CCL - boring businesses yes. However, all profitable and strong and all have charatcteristics that make them leaders. Some refer to them as "lazy" in boom times, nontheless - still standing in bad.

LICs despite some below nta trace the market. Nothing new there. Again, quality LICS will do well over time..those managed with pure rigour and sense of ruthlessness for owners are the ones to always be in, good and bad. Never been one to time the entry and exits, the ability to be able to add all year round (good & depressed)is beneficial.

The ability to learn upon the past and act on them so they dont occur again is important....but, its much better to learn from the mistakes of others than making them yourself. Case in point for all the *HOT* companies of the time that the herd flock to that really are on their last leg or dont exist anymore!


And who says Warren Buffett has lost his touch!