Value Invest London

March 2012

March 2012     Issue 8

The London Value Investor Conference – 19th April 2012
Since Issue 7, progress and interest in the conference has been beyond all our expectations. In February, we selected the charity which will benefit from all profit on the event: The SMA Trust, a children’s charity which supports vital research into finding a cure for Spinal Muscular Atrophy.   In March, we announced four illustrious new speakers from the US to add to the line-up: William Browne from Tweedy, Browne, Michael van Biema, Dan O’Keefe from Artisan and Ian Jacobs from 402 Fund.

Buffett article and annual letter to shareholders
Click here for the article
Click here for the video
Click here for his shareholder letter
This article was published in Fortune as an adaption / preview of his shareholder letter, published two weeks later. This would be an excellent one to give to a teenager or someone who is new to investment; it is typical of Buffett’s ability to set out the key tenets of his successful investment strategy in very straightforward language. We have also included a slightly out of date video which we missed including in the January edition. Here, amongst other comments on the US economy, Buffett discussed the Euro situation, which today may appear somewhat less risky than it did back then although we would argue that the fundamental risks have not really changed.

The best stock fund of the decade…but not necessarily for its investors
Click here
This article, written for the Wall Street Journal in 2009, is a fascinating insight into how investors in funds are often their own worst enemies. Whilst this successful fund posted 18% annual returns, the average investor in the fund lost an incredible 11% over the same period, because they traded in and out of the fund at the wrong time. This example illustrates that being a disciplined long-term investor is just as important when you are investing in funds as it is when investing directly in equities

An interview with Anthony Bolton
Click here
Anthony Bolton has been one of the UK’s most successful long-term investors – a shining example of the out performance that can be achieved from a disciplined long-term approach to investing. In this interview, he talks candidly about the challenges he has faced with applying his style of investment in China.

Howard Marks’ history lesson
Click here
In his latest memo (March 2012), Howard Marks treats us to an enjoyable trip back through history to dissect an article entitled “The Death of Equities”, published in Business Week in 1979. This memo draws the parallel to the negativity surrounding equities as an asset class today. He sets out some of the signals that we should look for in determining that the crowd has got it wrong and we have entered the period of maximum pessimism or optimism.

The case for value investing
Click here
Here, we provide access to a detailed white paper, which presents the statistical case for value investing outside the US. Whilst long, it is a good read because it also addresses some of the drivers for the long-term outperformance of value.

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  • “It’s very much the Rolls-Royce of the investor conference market”
    Paul Scott, Stockopedia
  • “The people in that room were a more powerful cadre of the powerhouse of investment than has been gathered for a very long time”
    Jonathan Ruffer, Ruffer LLP
  • “It’s kind of like Glastonbury isn’t it, for the Value Investing community”
    Nick Train, Lindsell Train
  • “What I like about it is that it is a practitioners conference and it’s an opportunity to come and hear from your peers about the work that they are doing and how they see value investing”
    Hassan Elmasry, Independent Franchise Partners
  • “I think people really look forward to it and enjoy it. There’s a good bunch of people here who have travelled a reasonable way – the speaker after me was from Hong Kong and there’s a big Canadian crew and a big US crew – people come from around the world to see this”
    Nate Dalton, Affiliated Managers Group
  • “If somebody’s already been through that process of seeing what the conference is about and then is willing to pay their money for the effort of coming here, that’s a great filtering process.”
    Gary Channon, Phoenix Asset Management
  • “The conference has become a part of the furniture of the London scene. You can discover that is what lies inside you – that you are innately a value investor.”
    Richard Oldfield, Oldfield Partners
  • “I do speak at a fair number of conferences to investor bases, this one is really quite a good list – some very, very good investors present and some very interesting speakers”
    Jon Moulton, Better Capital
  • “Definitely worth it and I know a number of people who have ‘ummed and arred’ about coming along and I’m sure that they will be regretting that they didn’t come today – and it’s only going to get better as far as I can see”
    Tim Green, Private Investor
  • “Having sat through the whole day as I wanted to come and hear all of the speakers – I’ve been really impressed by the quality”
    Anthony Bolton, Fidelity
  • “I’ve got a bunch of business cards to add to my collection and some folks I’ve been looking forward to meeting, plus some firms I didn’t even know existed but sound really interesting and I’m looking forward to building on that relationship base”
    Mason Morfit, ValueAct Capital
  • “You couldn’t find that anywhere else really, where you’re speaking to the principals who have been voted on to the Board [of Microsoft] to effect change”
    David Shapiro, Willis Towers Watson
  • “What I was impressed with is, because the subject is very similar, value investing, they found a variety of ways of attacking the same subject. I was also very impressed, having done this in another location, of seeing them stay on target time-wise so that it moves along at a great pace and I think the audience is greatly rewarded by that discipline”
    Don Yacktman, Yacktman Asset Management
  • “Very well organised and it was a treat for investors like us to hear some great speakers”
    Roli Saxena, Drona Capital
  • “I came last year and I liked it so much that I have been looking forward to today ever since”
    Dominique Levy, Sonian Capital
  • “We’e got a very sophisticated audience who are used to value investing – I think this is a good audience”
    David Samra, Artisan Partners
  • “The profile of the speakers is one of the main reasons that I came”
    Niels Borgen, Private Investor
  • “When you look at the ideas speakers have put forward in previous years and how they have performed over the last few years, they’ve done very well – if that performance continues it would be quite remarkable. It does show that you can pick up some good ideas at a conference of this sort”
    Jonathan Mills, Metropolis Capital
  • “I came last year as well and I thought that it was the most outstanding event that I have been to”
    Leon Boros, Equity Strategies