Saturday, 30 August 2014

About this blog and me

After a few write-ups I thought it was worthwhile to give some background, essentially an “about me” missive to shed some light as to how I came to value investing.

I was born in the CEE not too long before the one team, one dream idea of left-wing economic and political cohesion was in its last inning, so capitalism was an acquired taste for me. I got interested in business in high school and read every biography I could find on successful people to learn about their stories. I came across a few articles, then a few books on Buffett and via him I got an introduction to value investing, needless to say I was sold.

After high school I was fortunate enough to study abroad and spend semesters overseas working and studying. I was exposed to many ideas, experiences and people so those years had a tremendous impact on me. I’m very grateful for the people who made it possible and doors it has opened up. I also happened to have acquired a few three-letter qualifications but not one of them helped me make a single dollar in the markets. I believe that investing is "reps and sets" and you’ve to be innately curious; the more situations you see the better you become and not something you learn from textbooks. While he was in a different line of business, Biggie put these ideas very succinctly:

“Gotta try to stay above water y'know. Just stay busy, stay working. Puff told me like, the key to this joint, the key to staying on top of things is treat everything like it's your first project, nomsayin’. Like it's your first day, like back when you was an intern. Like, that's how you try to treat things like, just stay hungry.” - Notorious B.I.G interview sampled on Jay Z’s “My First Song”

I started investing while at university and have been at it since, with the last 4-5 professionally. My investment approach can be characterised as “go anywhere that’s cheap”, regardless of geographies and sectors, but with a bias towards smaller capitalisation companies.

I have a great interest in emerging markets but I’ll not beat up on the things you probably heard about the “emerging billions”, “consumers of the future” and so on. I certainly believe in the underlying trends, however you certainly have to pick your spots, as valuations are not as attractive as say 10-15 years ago. While I claim to have no special insight, I feel that I have a good understanding of the various fundamental drivers given my background as I experienced political and economic changes first hand.

In addition to EM, special situations always have a special place in my heart although from my experience by and large these occur in developed markets. Situations where there are natural/forced sellers such as large company spinning off a small subsidiary, operational/financial difficulties, bankruptcies and so on, create opportunities that attract me. What I like about these cases is that more often that not, you normally have to figure out two or three key factors to understand what causes the mispricing and develop a thesis. If you cannot you pass and go to the next one. As the price movement of these securities is reliant upon certain developments it’ll move less with the general market, which can be great. I do believe it’s important to keep a flexible approach and be able to invest successfully more than one way.

So what can you expect from this blog? A random selection of ideas that I think are interesting and 2-4 write ups a month as well as posts on articles/interviews/videos on investing and business that I think are worthwhile to share. Starting this blog will be a good way for me to keep track of some ideas and to organise my thinking as well as to develop a platform to share and discuss ideas with other like minded investors.