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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Michael Burry who wrote (4762)	8/22/1998 10:51:00 PM
From: James Clarke	Respond to of 78603

Absolutely. My portfolio is like a barbell - Graham stocks which I will sell at the first opportunity on one end, and Buffett stocks which I bought well and will not sell without a very good reason on the other. Its an unusual strategy, but it works for me because I see no reason to abandon either strategy. Its just a matter of recognizing immediately which one you are looking at when you start researching an investment. When I started to look at Penobscot for example, it is obviously a lousy business. All I care about is valuation. But if I sense a Buffett type opportunity, it is the business I spend my time on. Not that you buy it at any price, but my valuation methodology on one of these is a completely different technique. The difference is that the "Buffett" company has a target price which will rise 15% every year if I'm right. The Graham target may be $10 now on a $7 stock, but if it sits there for three years, the target may still be $10, or $9 or $8. Two very different games, and like Mike said, value investors get themselves in a lot of trouble when they mix them up. Jim