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 11/20   The Stingy News Weekly: November 20, 2017 
 11/20   We're all innocently out of touch 
 11/20   Mind the gap 
 11/20   Right math, wrong conclusion 
 11/20   Fairfax vs. Berkshire Hathaway 
 11/20   Thinking outside the box 
 11/20   Two heads might be worse than one 

Most Recent Stingy News

The Stingy News Weekly: November 20, 2017
11/20/17 8:45 PM ESTSNW
This week we have a consensus on bs in the gap and more.
More SNW: The Stingy News Weekly: November 12, 2017
The Stingy News Weekly: November 6, 2017

We're all innocently out of touch
11/20/17 6:41 PM ESTBehaviour
"An American born in 1970 saw stocks rise more than eightfold in their teens and 20s. An American born in 1950 saw stocks go nowhere in their teens and 20s. In Japan, the difference between back-to-back generations was losing 100% of your money vs. making 11.5x on your money."
More Behaviour: Investors do not underperform their investments
How fiction becomes fact

Mind the gap
11/20/17 5:44 PM ESTGovernment
"On a walking tour of town officials and development consultants pointed to empty buildings and described all the things that could be done to bring them back to productive activity: open up the blank walls and re-install windows, incubate all kinds of new businesses, paint, outdoor seating. I rolled my eyes. None of those things make any economic sense given the regulatory hurdles involved and the likely negative return on the up front investment. I've seen this scenario play out many times before."
More Government: Right math, wrong conclusion
Inside Trump's U.S.D.A.

Right math, wrong conclusion
11/20/17 5:41 PM ESTGovernment
"The answer is to confront the truth that the public plans are too generous and need rethinking. But wait, can't you hear the public-sector workers saying that it's unfair to reduce their DB promise because they have paid for it? Well they haven't. Government workers and their employers are still funding their pensions assuming the same 1990s returns that built the Factor of 9 (or maybe a factor of 12). They are ignoring the true cost of the pensions being earned and they hope that future investment gains will forever hide the fact that the guaranteed benefit they are receiving is being funded by risky investments that may or may not pay off. Government workers are paying about 12% of pay for a benefit that is worth about three times the amount even though the government is telling taxpayers its only worth twice as much."
More Government: Inside Trump's U.S.D.A.
SEC insider-trading-like returns

Fairfax vs. Berkshire Hathaway
11/20/17 5:38 PM ESTValue Investing
"We find that while value beats growth (that is, the value premium is confirmed) in the total sample (on average, by 430 basis points annually - a basis point is 1/100th of a percentage point), the value premium is actually driven by the firms with the poorest earnings quality. The average value premium for the best earnings quality firms (the top quartile) is 60 basis points, whereas the corresponding value premium for the poorest earnings quality firms (the bottom quartile) is 960 basis points. That is, an investment strategy that emphasizes lower-quality value stocks will improve the long-term performance of a value portfolio."
More Value Investing: Lou Simpson interview
Joel Tillinghast interview

Thinking outside the box
11/20/17 5:35 PM ESTStingy Investing
"Charlie Munger, Warren Buffett's long-time partner and pundit at Berkshire Hathaway posed a tricky question. He asked for instances when the reverse was true. That is, when does raising prices lead to increased sales volumes?"
More Stingy Investing: Two heads might be worse than one
Inspired by valour

Two heads might be worse than one
11/20/17 5:33 PM ESTStingy Investing
"Money manager Lou Simpson recently talked about the negative correlation between the number of people making an investment decision and the results. He noted that if a lot of people are involved, the tendency is for the least competent person to effectively make the decision when a consensus is required." [$]
More Stingy Investing: Inspired by valour
Top Stock Preview

The Stingy News Weekly: November 12, 2017
11/12/17 9:13 PM ESTSNW
This week we have a buffet of crime, ruin, and disaster that is offset by wisdom, valour, and more.
More SNW: The Stingy News Weekly: November 6, 2017
The Stingy News Weekly: October 30, 2017

Inside Trump's U.S.D.A.
11/12/17 7:33 PM ESTGovernment
"The folks at the Department of Agriculture laid on a friendly welcome for the Trump transition team, but they soon discovered that most of his appointees were stunningly unqualified. With key U.S.D.A. programs - from food stamps to meat inspection, to grants and loans for rural development, to school lunches - under siege, the agency's greatest problem is that even the people it helps most don't know what it does."
More Government: SEC insider-trading-like returns
Pension crisis

Time to rethink the RRSP contribution limit
11/12/17 7:31 PM ESTRetirement
"If you diligently maximize your RRSP contributions each and every year but have this nagging feeling that you may end up worse off in retirement than your neighbour, who is fortunate enough to belong to a well-funded defined benefit pension plan, you're probably correct."
More Retirement: Safely withdraw funds in retirement
Rule of 300

The dead man fund
11/12/17 7:28 PM ESTFunds
"William Steadman's four funds regularly appeared on fund-watchers' lists of the worst investments. By extracting from investors such high expenses, he had conned them within the limits of the law."
More Funds: Institutional investors, just like us
Index fund contrarian

Lou Simpson interview
11/11/17 4:42 PM ESTValue Investing
"There's also a negative correlation between the number of people making the investment decisions and the results. If you have a lot of people involved, you tend to have the least competent person making the decision, because you need consensus."
More Value Investing: Joel Tillinghast interview
Tobias Carlisle interview

The dangerous world of tiny IPOs
11/11/17 4:31 PM ESTCrime
"One executive was convicted of filing false tax returns, another for obstructing justice and a third accused of selling unregistered stock. But three tiny companies with ties to the executives have now gone public in the U.S. in what may just be the zaniest little market on Wall Street: mini-IPOs."
More Crime: The latest investment scam
The Pigeon King

A restaurant ruined my life
11/11/17 4:25 PM ESTFood
"I was a foodie with a boring day job who figured he could run a restaurant. Then I encountered rats, endless red tape, crippling costs and debt-induced meltdowns, started popping sleeping pills, lost my house, and nearly sabotaged my marriage"

Momentum and reversals can coexist
11/11/17 3:45 PM ESTMomentum
"The bottom line is that the research shows that short-term momentum and long-term reversals coexist in global equity markets."
More Momentum: Mean reversion via momentum
How not to wipe out with momentum

Time diversification redux
11/11/17 2:32 PM ESTMarkets
"Return volatility rises as its calculated holding period nears 1 year and falls as it lengthens to 10 years. Lower volatility at longer holding periods implies that longer-term mean reversion exists."
More Markets: Risks building in the markets
The dangerous allure of designer risk factors

Inspired by valour
11/11/17 2:04 PM ESTStingy Investing
"You'd have done well to have followed his advice in 2013 when he recommended General Communication Inc. (GNCMA). The Alaska-based integrated telecommunication company benefited from a recent takeover offer and is on track to be acquired by Liberty Interactive. The stock was recommended at $9.76 per share and it recently closed at $40.36. Those who held it over the period gained a whopping 314 per cent, which translates into an annualized return of 43 per cent. It was a big winner for Mr. Smith who recently sold his stake in the firm." [$]
More Stingy Investing: Top Stock Preview
Top 200 Canadian Stocks

The gospel according to Michael Porter
11/11/17 2:00 PM ESTManagement
"The old-school fundamental value investors who prize Porter's frameworks have come under fire from a familiar source: the Chicago school. Chicago's Fama has published studies showing that actively managed mutual funds underperform the market and that small value companies - not large market leaders, as Porter would have it - are the best-returning stocks. Fama's works suggests that Benjamin Graham's instincts were right: The real money is to be made betting on the Davids of the world, not the Goliaths."
More Management: Morally bankrupt
Cheap Chick-fil-A franchise

The Stingy News Weekly: November 6, 2017
11/06/17 9:06 PM ESTSNW
This week we have the Top 200 Canadian Stocks, Top 500 U.S. Stocks, and more.
More SNW: The Stingy News Weekly: October 30, 2017
The Stingy News Weekly: October 23, 2017

Top Stock Preview
11/06/17 8:36 PM ESTStingy Investing
"I always like to step back and look at the market as a whole before focusing in on the best names. To do so, I use median market metrics instead of averages because medians are less influenced by the extremes."
More Stingy Investing: Top 200 Canadian Stocks
Top 500 U.S. Stocks

Top 200 Canadian Stocks
11/06/17 8:35 PM ESTStingy Investing
"We're pleased to say that our track record has been highly profitable over the years. Our All Stars climbed by an average of 14.6% per year since we started in 2004, not including dividends. That assumes an equal dollar amount was put into each All Star stock in the first year and rolled into the new All Stars each year thereafter. By way of comparison, the S&P/TSX Composite (as represented by the iShares XIC exchange traded fund) climbed by 4.8% per year over the same period. The All-Star stocks beat the market by an average of 9.8 percentage points per year."
More Stingy Investing: Top 500 U.S. Stocks
The monster portfolio

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2017: New Picks
2016: Up 1.6
2015: Up 2.2%
2014: Up 5.1%
2013: Up 19.0%
2012: Up 26.6%
2011: Up 4.1%
2010: Up 2.3%
2009: Up 2.2%
2008: Down 6.5%
2007: Up 34.4%
2006: Down 3.8%
2005: Up 46.6%
2004: Up 32.2%
2003: Up 56.8%
2002: Up 28.2%
2001: Up 20.2%

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+15.8%/yr (CAGR)

2015: New Picks
2014: Up 2.3%
2013: Up 55.0%
2012: Up 13.4%
2011: Down 4.2%
2010: Up 19.7%
2009: Up 41.0%
2008: Down 32.9%
2007: Up 16.2%
2006: Up 37.6%
2005: Up 57.6%

Stingy Stocks
+13.9%/yr (CAGR)

2016: New Picks
2015: Down 1.4%
2014: Up 6.9%
2013: Up 37.8%
2012: Up 10.9%
2011: Down 16.1%
2010: Up 69.4%
2009: Up 64.5%
2008: Down 40.1%
2007: Down 5.5%
2006: Up 28.9%
2005: Up 29.2%
2004: Up 29.8%
2003: Up 33.8%
2002: Down 1.9%


Asset Mixer
Periodic Table

More Stingy Investing

Thinking outside the box
Two heads might be worse than one
Inspired by valour
Top Stock Preview
Top 200 Canadian Stocks
Top 500 U.S. Stocks
The monster portfolio
Value in the soda aisle
A succulent value strategy
The state of dividends
Top dividend stocks
Strategy Lab ends
Not a single loser
Low-P/E value
The return of the cats and dogs
Dining on value
The time travelling manager
Stocks with room to grow
Small value stocks
Deep value
A big dividend bonanza
Top 1000 Preview
Top 1000
Top 1000 list
The tail of the bond bull
Not dead yet
The Safer Dogs of the TSX
A long-term return guess
Branching out in search of value
Chasing dividend growth
A Hot Potato update
Ben Graham MBA contest for 2017
A dividend growth downer
The market timing myth
Fairfax Valu-palooza
The permanent portfolio
Bad behaviour or bad math?
Simple asset allocation
The Climbing CATS
Valeant's rise and fall
Your personalized rate of return
A hard pill for savers to swallow
The enemy of investment returns
The brain-bending world
Doing better than you think
More wishful thinking than rule
Value by sector
Speculating on 2017
Asset Mixer Update
Periodic Table Update
Pick winning stocks for 2017
A word from a portly gentleman
Low P/E stocks unlock value
Long-term losers
A Hot Potato feast
Books for the holiday season
Slice and dice
Top 200 total returns
Top 200 Canadian Stocks for 2017
Top 500 U.S. Stocks for 2017
The value of momentum
MoneySense goes all digital
2 Graham Stocks for 2017
The salary class
The price of financial advice
Dividend All-Stars 2016
Let's talk about salary
The trouble with 4 per cent
Buyback yield
Top dividend stocks of 2016
Learning to live with low returns
The power of incentives
Boost returns with low P/E stocks
The pleasures of the bargain bin
The lost decade
Be careful what you wish for
Fixed income needs a fix
Brexit-proof your plan
Tips for novice investors
Inflation and the 4% rule
Equally weighted
More ......

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