Value investing, Fundsmith and Charlie Ellis - the best investing blogs and podcasts from the past week
Hello!
This is the final Fully Invested newsletter for 2022 - a year that was challenging for investors in ways we haven’t seen for quite some time. And when you consider we were being hit by a global health emergency less than two years ago, that’s really saying something.
This weekly newsletter is now six months old and doing it has been really valuable to me in so many ways. I hope it continues to be useful to you, too.
All the best for 2023,
Ben
Highlights from the past week
Richer, Wiser, Happier - [Video] Winning the Long Game with John Spears
John Spears is on the management and investment committees of Tweedy, Browne, the famous value-focused money management firm. So this is a conversation for anyone with an interest in old school value investing.
It starts with an exploration of his early life and investing career. Spears was trained in the traditional Ben Graham school of bargain value investing but dropped out of college and went his own way.
Tweedy, Browne was very much the centre of gravity for quite a few value legends, like Warren Buffett, Walter Schloss, Bill Ruane, Ed Anderson and Tom Knapp, and in some ways it still is. These days the firm goes beyond the standard Graham principles and it’s interesting to hear Spears’ explanation of that, especially on the qualitative side (~49.00).
There’s no getting away from the fact that Tweedy, Browne has suffered like other value managers against passive index funds in recent years. From 55.00 Spears picks up on this and talks about the firm’s commitment to those original strategies. He also covers issues like leverage, diversification, investing internationally (Tweedy, Browne has substantial positions in UK shares) and happiness.
Be warned, the conversation stretches to nearly two hours. But it’s an interesting discussion with an important figure in the history of value investing.
You can find a podcast version of this here
Maynard Paton - [Podcast] Fundsmith With Mark Atkinson And Maynard Paton
Terry Smith’s Fundsmith equity fund has delivered impressive returns since its inception in 2010 - with something like a 16% average compound growth rate. For Mark Atkinson, who regularly joins up with Maynard Paton on these podcasts, it turbo-charged his portfolio returns to the point where he could retire early. Smith’s investing approach is famously quality-focused and includes several big US companies. The rising valuation of those holdings on a free cash flow basis, combined with the strength of the US dollar has been a major boost for the fund in recent years. Past returns may not continue at the same rate - but all the same, it’s a stellar performance.
Maynard and Mark pick apart some of the fund’s top holdings and look at Smith’s strategy and selling decisions. With a pledge to “buy quality companies, try not to overpay and then do nothing”, Fundsmith’s churn is very low and selling seems to happen only when the fund feels management decision-making has been questionable. Among several interesting points is the question of whether he’s wrong to be in stocks like Meta Platforms (Facebook) and Amazon.
This is a great bull case versus bear case discussion - well worth a listen.
Masters in Business podcast - Charlie Ellis on the Rules of Investing
This is an interesting conversation for anyone with a passing interest in the world of indexing and passive investing. Charlie Ellis is one of the pioneers of passive and had a front row seat in the early days of industry giant Vanguard. He takes Barry Rithholtz on a tour of some of the influential figures that shaped the company, starting with its founder Jack Bogle. He talks about how the company built a culture under Bogle but how it wasn’t until the founder left that the company really developed into what it is. It’s clear from the conversation he’s still firmly of the view that passive investing will ultimately usurp active management.
Ellis is the author of several books, including Winning the Loser's Game: Timeless Strategies for Successful Investing.
The transcript of the interview is here
Thinking & Strategy
The London South East, Investing Matters Podcast
[Podcast] Episode 30, Amanda Sillars, Director & Investment Manager at Jupiter Asset Management
Excess Returns
[Podcast] High Quality Value Investing with a Tactical Twist With Jeff Muhlenkamp
Meb Faber Research – Stock Market and Investing Blog
Episode #461: Top Podcasts of 2022: Rob Arnott & Campbell Harvey, Whitney Baker, Harris “Kuppy” Kupperman, Marc Cohodes, & Peter Zeihan
Capital Allocators with Ted Seides
[Podcast] Year in Review 2022
A Wealth of Common Sense
9 Things That Surprised Me in 2022
Crow Knows
The message from the bond markets
Institutional Research
Tom Stevenson, Fidelity International
My predictions for 2023
Franklin Templeton
A path through the market fog
Alpha Architect
The Performance of Multi-Factor Long-Short Portfolios in Various Economic Regimes
Securities & Markets
The Investor Way
Re-Release - E15 - Fantasy Portfolio - Year 1
Capital Employed
Hearing Aids to Japanese Microcaps
Quality Small Caps
Small Caps Podcast with Paul Scott – episode 26 (part 1 of 2)
Small Caps Podcast with Paul Scott – episode 26 (part 2 of 2)
The Vox Markets Podcast
[Podcast] 1096: Paul Hill: Upgrading your stocks in a bear market, strategy for 2023 plus some stocks to follow
Stock Club
[Podcast] Stock Club's Big Fat Wrap Up of 2022
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UK's top-performing stocks lag international rivals in 2022