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Anthony Grossi

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  • Looking For Value In An Overbought Market? Try These Hated Conglomerates [View article]
    unfortunately, if your broker doesn't allow you to buy stocks on foreign exchanges a couple of the ideas I mentioned go out the window. Thanks for highlighting RIT, I'll definitely take a look.
    Apr 16 05:54 PM | Likes Like |Link to Comment
  • Looking For Value In An Overbought Market? Try These Hated Conglomerates [View article]
    thanks for the compliment, hope some of my ideas will work out for you.
    Apr 16 04:48 PM | Likes Like |Link to Comment
  • Looking For Value In An Overbought Market? Try These Hated Conglomerates [View article]
    thanks for the tough question...

    in general I prefer the parent company because they ultimately have more control over things. That being said BAM will never be a go to dividend stock, but many of its subsidiaries like BPY and BIP are very good dividend paying stocks.
    Apr 16 04:47 PM | 2 Likes Like |Link to Comment
  • Frustrated for years Loews (L) doesn't trade at or above a sum-of-the-parts valuation, the Tisch family may be going after a new type of value investor, unveiling a snazzy (by value shop standards) new logo and website, and introducing comic book hero Lotta Value: Investment Hunter. Underneath it all, nothing's changed: "Money does not burn a hole in our pockets - we set a high bar for use of our cash resources." [View news story]
    so many reasons to like the management, how about this old story
    Apr 14 05:49 PM | Likes Like |Link to Comment
  • Gold Has Held Its Value Over The Last 2,500 Years: Fact Or Fiction? [View article]
    The one I always heard was that an ounce of gold bought a toga of the finest quality in ancient Rome. Therefore, an ounce of gold ought to buy a suit of the finest quality. So using that as a comparison gold more or less has held its value for the last 2500 years, although with some fluctuations.
    Apr 10 01:21 PM | 2 Likes Like |Link to Comment
  • Opportunity Costs Matter [View article]
    it is the opposite of given, most investors under-perform. I wrote an article called "index investors are always above average" which explains why the average return of an index is always above the median. I wrote this article simply to make investors think about including their time and the opportunity costs associated with that time invested when calculating their portfolio returns.
    Apr 8 02:16 PM | 1 Like Like |Link to Comment
  • Valuation Model For Brookfield Asset Management [View article]
    I copy and pasted the holdings from the annual report and have no idea which subsidiaries own which parts of what other subsidiaries. This issue should be clarified by the spin-off of BPY. So if BAM owns that portion of GGP (part of those warrants were repaid recently) through a fund, the company includes it in its consolidated earnings. But even if you discount the $11.4 B I guestimated for BPY, you are still buying the asset management firm for free.

    Shares currently trade at a 25% discount to managements stated intrinsic value of $45/per share. So if BPY owns $10B of those subsidiaries I listed out my sum of parts method replicates the companies assessment.

    Which is still going to be an aggressive valuation. I was just going for an intuitively simple way of adding up the parts.

    Thanks for pointing out the flaws and for taking the time to comment.
    Mar 28 12:32 PM | 1 Like Like |Link to Comment
  • Index Investors Are Always Above Average [View article]
    (1) the point I was going for was that the person who wants to beat the market thinks that being an above average stock picker (top half of market participants) is enough, whereas evidence suggests it is a necessary but not a sufficient condition

    (2) Index investing isn't for everyone, I have both passive and active components to my portfolio. Its like reading Ben Graham explain NCAV investing, the logic of indexing (or net-nets) either grabs you or it never will.

    (3) There are some academic studies that suggest that individual day-traders are, as a group, the least successful of all investors.

    (4) Knowing a bunch of traders who suck doesn't improve your odds any. One of the points I was aiming for in this article is that being in the top half of market participants doesn't necessarily equate to beating the market. Actually the odds are against us outperforming the market after taxes/other frictional expenses the longer we play.
    Mar 22 02:58 PM | Likes Like |Link to Comment
  • Index Investors Are Always Above Average [View article]
    Apologies if I misused the term price, i was intending to compare investor performance with market returns, prices as such are incidental.

    investor performance follows a normal distribution, stock returns are log-normal. Hence, the possibility of above avg investor performance that is still below the stock return avg.

    It's a little-known and depressing fact, but the majority of individual securities tend to post negative returns over the long run.

    In fact, researchers at the investment management firm Dimensional Fund Advisors found that from 1980 to 2008, the top-performing 25% of stocks were responsible for all the gains in the broad market. As for the bottom 75% of stocks in the U.S. market, they collectively generated annual losses of around 2% over the past 29 years.
    Mar 21 06:23 PM | 1 Like Like |Link to Comment
  • Prem Watsa And Jeremy Grantham Have Completely Opposite Views On Commodity Prices [View article]
    I have no problem with in investing in productive companies in the commodities space. They create value by refining products, creating efficiencies in distribution, etc. XOM is an excellent example of this. However, I would like to take a second to expand on Prem Watsa's thesis and why I take his side in the argument.

    A bet on rising commodities prices is a bet against human ingenuity. Commodity prices should always go down in real dollar terms over the course of complete market cycles. Why? Because they are generally cheaper to produce, because over time human ingenuity will lower the cost of production through innovation, or find new substitutes for scarce resources. Think of the colonial spice trade, whaling, crop yields per acre. Look at the oil price chart, think about how much demand expanded b/t 1860 and 1980 before the price of oil started to rise significantly.

    Alternatives exist but are too expensive. Well, if Grantham is right, they won't be too expensive for long and once adopted, human ingenuity will drive the production cost down for alternatives while the drop in demand will drive down prices for oil. In the long term (which can be appallingly long) pure commodity investments are a suckers bet.
    Mar 14 10:46 AM | Likes Like |Link to Comment
  • Biglari Holdings, Inc: Sardar Biglari - Bet The Jockey Part IV [View article]
    with Cracker Barrel represented better than $300 per share of BH's current value, I'd love to see Biglari find a more permanent source of investment funds than flipping restaurant chains. Given the precedent with Freemont and Penn Miller, riding his coat-tails into UNAM looks like a pretty good bet.
    Mar 12 03:35 PM | Likes Like |Link to Comment
  • A Portfolio For A Young, Aggressive Investor [View article]
    balanced portfolio of index funds, like the star fund, are a much better place for young investors to start. What will make you the most money in the long run is investing in yourself and living within your means. Think about it mathematically, let's say you can earn 15% in the market vs 7% for an index fund over 10 years and you are a young investor starting with $10 grand; and that this is because you took your own advice about researching and reading for 20 hrs a week. Get out a calculator and figure out how much you earned per hour versus simple indexing. Then take a second to realize how poor the odds are of you actually doubling the market return over the long run. Index investing starts to make a lot more sense once you factor in the opportunity costs.
    Mar 10 04:26 PM | 5 Likes Like |Link to Comment
  • Biglari Holdings, Inc: Sardar Biglari - Bet The Jockey Part III [View article]
    great series so far
    Mar 10 11:07 AM | Likes Like |Link to Comment
  • Conversion To Franchise Model At DineEquity Makes For An Attractive Dividend Stock [View article]
    so far Marcato has gotten everything they asked for except the $6 dividend
    Mar 7 01:40 PM | Likes Like |Link to Comment
  • The Dumbest Portfolio For The Smartest People [View article]
    there are several mutual funds that already replicate the Barclays Aggregate World Bond Index at fairly reasonable expense rates (given the difficulty of replicating that exposure on your own) but of far greater interest to the author of the article, Vanguard has finally announced plans to introduce a global bond index fund, which when coupled with BND, should provide the cheapest means of achieving your vision of a global balanced index portfolio. I currently use VTWSX and LSGLX plus a little dash of BRSIX to accomplish this same goal. Will replace my bond fund as soon as someone creates a cheaper index version.
    Feb 28 06:23 AM | 2 Likes Like |Link to Comment