“I knew a guy who had $5 million and owned his house free and clear. But he wanted to make a bit more money to support his spending, so at the peak of the internet bubble he was selling puts on internet stocks. He lost all of his money and his house and now works in a restaurant. It’s not a smart thing for the country to legalize gambling [in the stock market] and make it very accessible.”-said Charlie Munger
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Patience is an investing virtue
A “price conscious” buy is the critical lynchpin for our strategy, as it not only sets the basis for future return potential, but as importantly provides downside protection to avoid a return sapping capital loss. It is said that patience is a virtue, and indeed for our strategy, patience for an appropriate discount is essential for our purchase decisions. As we scour our broad and eclectic investment universe, we analyze many more companies than we will ever own. It is this continuing due diligence of management discussions, supplier, vendor and competitor interviews and financial statement analysis that helps us build our industry knowledge and form our unique view on what an enterprise and its assets are worth. We analyze many ‘good’ companies, but it is critical that we are patient and buy opportunistically when the discount to asset value provides an acceptable return and a mitigation of risk.-wrote fund manager Chip Rewey
“Why do gamblers continue betting even when they are losing money?” he asked while flicking through screens of stock prices and charts on a trading terminal at a Beijing brokerage firm this month. “It’s the same investing in stocks. If you lose money, you want to make up the losses. If you earn money, you want to earn more.”-from NYTimes