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Book: Trade like Warren Buffett

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By James Altucher

page 81
Margin of safety?
Buying a stock that is trading at 2/3 of its liquidation value (Graham-Dodd).
Buffett moved beyond that understanding in early 60s, focused more on qualitative aspects:
brand value, earnings growth,

page 155
A closed-end fund: a fund whose shares trade on the stock exchange like any other company.
Unlike an open-end fund, a closed-end fund has a fixed num of shares and no longer accepts inflows / outflows of money.
e.g. Berkshire Hathaway

page 160
Closed-end funds are not popular investments.
Poor performance frightens off investors.
The NAV might include capital gains that have yet to be taxed. The shares will reflect this tax liability by trading at a discount.
There are too many illiquid / hard-to-value securities in the portfolio.

Adv of investing in closed-end fund : they often pay high dividends.

page 175
The value investor’s lament:
We always sell too early, because we have to sell in order to keep the margin of safety.

Other books to read:
American Capitalist by Roger Lowenstein


Written by blueroselady

November 28, 2009 at 3:37 pm

Posted in finance

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