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(And now a short break from our normal programming…. In a comment linked from the Wikileaks Twitter feed on the recent PRISM disclosures, Bernard Keane characterises the surveillance state with the term information asymmetry: “Information asymmetry is how your government wants to know everything possible about you — where you are, whom you called, what you … Read more

ADVFN, Interactive Investor, MoneyAM, Motley Fool, t1ps.com.  Financial website entrepreneurs don’t seem to be very good at choosing names.   This post tries to do better. It is not really an investment post, except insofar as a start-up with a good name may have a slightly better chance of success than one with a poor name. … Read more

One criticism of the investors in Free Capital  which I have heard from more than one expert reader goes something like this: “The interviewees say they are making investment decisions, but none ever actually works out what a company is worth.”  These readers then elaborate on the concept of intrinsic value – the discounted future cashflows (DCF) of the … Read more

INTRODUCTION If you want immediate practical ideas, my short answer is to follow Givewell recommendations. If you want to know how I personally think about choosing charities, read on. Issues-agnostic My starting position is issues-agnostic. I don’t have any prior commitment to a cause related to my family background or life trajectory. I tend to be suspicious of causes … Read more

Investors Chronicle by Alistair Blair. Extracts: “…a compelling read…” “You could learn a lot from this dazzling dozen…” “…definitely the best investment book that has crossed my desk for some time.” Full text of review here. Stockopedia Extracts: “At last,a true to life account of UK investing…” “…highly recommended reading…” Full text of review here. Andrew Howe (longer version of … Read more

The investors in Free Capital have divergent views on the value of meeting company management.  Bill (Chapter 3) : “I never visit companies, hardly ever go to an AGM, and speak to hardly anyone.” Sushil (Chapter 5) : “…the relevant question for me is whether, say, six hours spent on a meeting with one company I already own …is more … Read more

This is another angle on the “how many shares” question. Over the years I have observed many successful private and professional investors.  There have been a very few – including some, but not all, of the investors in Free Capital – about whom I’ve thought “If I ever get bored of investing, I’d be happy for them to … Read more

My last post discussed how many shares one should hold in a relatively abstract way. Another angle is to ask how many shares it is practical to follow. There is clearly some sort of trade-off between number of shares held and your quality of knowledge.  Many experienced private investors are surprised (and often derisory) about the … Read more

Most of the investors in Free Capital  hold concentrated portfolios, sometimes of fewer than ten shares (Luke, Owen and Taylor). Others such as Eric, John Lee, Peter Gyllenhammar and Sushil hold up to 60 shares.  Who is right? How many is too many? Many experienced investors advocate a small number of holdings. I used to think … Read more

Diamonds These are the shares orthodoxy says you should buy: shares in businesses with exceptional economics and long-term comparative advantage.  They are shares you would buy if you followed the Buffett doctrine: choose shares you would be happy to hold if the stock market closed tomorrow for five years.   Flower bulbs These are shares which are cheap … Read more