Blog 2018-06-01T19:13:27+00:00

Un-Liking Facebook

By | April 26th, 2018|

(This blog post was written on March 26, 2018 and included in our client newsletter for Q1 2018)  As many of our clients have undoubtedly noticed, Facebook is currently in a bit of a slump. Its shares are down around 20% from its peak at the beginning of February, and seems to be hit with bad news almost daily.

The Return of Volatility

By | April 12th, 2018|

In the two year period from January 2016 to January 2018 the S&P 500 Index had only one month in which it dropped as much as 1%. That is a remarkable and unprecedented record of stability. During that time span the market rarely moved either up or down more than 1% per day, and for the chart-watchers, never once dropped below its 200 day moving average price.

Cash Isn’t Trash; but Holding Too Much is Rash

By | March 22nd, 2018|

“25% of my portfolio is in cash,” is what I heard a portfolio manager say on TV during the February market correction. If only I had a dollar each time someone made this vacuous statement—I certainly wouldn’t keep it in cash! I don’t know why some portfolio managers think this is a viable marketing tactic, because I can’t imagine that anyone thinks that sitting on cash is a worthwhile investment approach.

Great Capital Allocation Makes a Great Company: CCL Industries

By | March 2nd, 2018|

Those who have followed my blogs know how much emphasis I place on capital allocation; that is, how management manages the excess free cash flow and capital structure of the business. We generally prefer dividends and buybacks since it demonstrates an acknowledgement by the management and the Board of Directors that the cash belongs to shareholders, but there is a special class of companies where the management does an outstanding job of creating value through acquisitions. CCL Industries is a good example of this.

Our Letter to Clients: Stay the Course

By | February 9th, 2018|

The long-awaited market correction has finally arrived, and with a bang at that. In our meetings with clients and in our periodic pontifications on radio and TV, we have consistently expressed the view that the straight up momentum of world stock markets could not and would not continue, and that we were bound to see a market draw-down of at least 10%, and perhaps as much as 15% or 20%, likely some time in 2018. 

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