Managing partner of Quintessential Capital Management, an investment fund, and Zanshin Capital, an asset management company both focusing on long-only, absolute return, equity investments with a value approach. I have started investing from an early age, but only in 2005 did I discover the wisdom and effectiveness of value investing. After reading every book I found on the subject, I studied for a short, but extremely profitable period, under the guidance of Prof. Bruce Greenwald of Colombia University, who specializes in value investing. The core positions in my portfolio are classic Buffett-style franchises acquired at a discount and kept indefinitely. The idea is acquiring a company in a slow-changing industry with a protective moat and letting it compound for years. Occasionally, I go for "cigar butt"-style investments, where a mediocre company is acquired at a steep discount. But, in general, I prefer the former type. I focus on US stocks but do keep my eyes open for global opportunities as well.
A*L was established in 2010 by Jon Carnes, a growth and value-oriented investor who lived for six years (from 2005 to 2011) in China where he researched and invested in dozens of Chinese companies, first long (2005-2009) and then primarily short (2010-2012). Mr. Carnes outperformed other investors by performing extensive “on the ground” due diligence, conducted by a team of experienced analysts and local researchers. His investment opinions were greatly respected by other China focused fund managers attracted to the booming economy but wary of getting duped.
Over several years of scrutinizing over a hundred companies in every corner of China, Mr. Carnes realized that many of those that had gone public were seriously exaggerating their financial performance in their SEC filings. Investors raced to invest billions into Chinese companies that were dishonest and legally accountable to no one, a recipe for disaster for investors, both large and small.
Deciding to take action, Mr. Carnes decided to publicly expose the most egregious frauds he had discovered over the years, focusing on the worst offenders: companies that had exaggerated their profitability by at least 100%. In February 2010, he published a series of reports titled “Management Leaving Investors Stuck at the Pumps” showing that China Natural Gas (formerly NASDAQ: CHNG) management defrauded investors by failing to disclose and likely misappropriating $20 million from an acquisition of an undisclosed related party.
Unfortunately, when CHNG discovered that Mr. Carnes wrote the reports, its chairman Qinan Ji responded by sending an agent to threaten him where he lived in China. Frightened by Ji’s threat, Mr. Carnes removed the reports from the Internet. From this point onward Mr. Carnes knew that publishing the truth while living in China might get him killed.
Mr. Carnes nevertheless chose to remain in China to continue exposing fraud. Knowing that the safety of his researchers depended upon absolute secrecy and anonymity, he published my reports anonymously online using the obvious pseudonym “Alfred Little.” Beginning with CHNG, over the next two years Mr. Carnes exposed a diverse array of investment fraud committed by a U.S. listed Chinese companies.
After two years, CHNG Chairman Qinan Ji’s effort to conceal his fraud finally failed. On 9/21/11 NASDAQ halted trading of CHNG and on 3/8/12 CHNG was delisted. Most importantly, on 5/14/12 the SEC filed fraud charges against CHNG and its Chairman Qinan Ji.
Two more of the companies that Mr. Carnes first exposed faced the same fate. On 2/22/12 the SEC charged Puda Coal (formerly AMEX: PUDA) Chairman Ming Zhao with fraud, confirming each of the allegations in his 4/8/11 report, “Puda Coal Chairman Secretly Sold Half the Company and Pledged the Other Half to Chinese PE Investors.”
Then on 4/23/12 the SEC charged SinoTech Energy (formerly NASDAQ: CTE) and two of its officers with fraud. On 8/16/11, Mr. Carnes was the first to blow the whistle exposing CTE’s massive fraud in a report titled “SinoTech Energy: Enhanced Oil Recovery or Capital Extraction.” Unlike other numerous smaller “reverse merger” frauds, Sinotech was a $168 million IPO listed on NASDAQ underwritten by UBS and Lazard Capital Markets and audited by Ernst & Young.
Three companies, Deer Consumer Products (“DEER”), Sino Clean Energy (“SCEI”) and Silvercorp Metals (“SVM”) criticized in reports published by A*L sued Mr. Carnes for defamation. The three companies coordinated their legal and retaliatory efforts, both in the U.S., Canada and China to silence Mr. Carnes.
The epic battle that followed ended swiftly in a complete rout. NASDAQ delisted DEER and SCEI. SVM and DEER both lost their defamation claims against Mr. Carnes. SCEI abandoned its defamation claim against Mr. Carnes.
After winning the battle against DEER, SCEI and SVM, A*L emerged with the best track record of any China focused investment blog.
Founded by Nate Anderson, CFA, CAIA, Hindenburg Investment Research specializes in forensic research and activist short-selling. Our experience in the investment management industry spans over a decade, with a historical focus on buy side equity, credit, and derivatives analysis.
While we use fundamental analysis to aid our investment decision-making, we believe the best edge can be had by uncovering hard-to-find information from atypical sources. In particular we look for situations where companies may have any combination of (i) accounting irregularities (ii) bad actors in management or key service provider roles (iii) undisclosed related-party transactions (iv) or illegal/unethical business or financial reporting practices.
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Investing is an art, not science.
It requires with PATIENCE, DISCIPLINE and GUT because
FORTUNE favors the BOLD.
We should take a RISK, life is a RISK (not gamble), MONEY set us free (financially).
I consider DEBTORS are lower on the financial food chain. DEBTORS have less POWER, less PRESTIGE, and less PROSPERITY. Being free of DEBT, whatever kind, makes you free. You will always Sleep Well At Night (SWAN), knowing you are beholden to no one, and no one
has the POWER controlled over you.
CEFs, for predictable monthly and quarterly incomes; Distressed Prefers and Bonds, for fixed incomes: and 15% cash for OPPORTUNISTIC swing trades or SPECIAL situations play for CAPITAL gains or VALUE appreciations. In the case of the latter, I invest with extreme caution: Knowing when to own, to hold, to fold and to book.
Let me make it very clear: We all have our dreams, investing in our beautiful dreams can be very risky, tricky, hazardous, arduous, heartache, gut-wrenching, sleepless, dilemma and nightmare, never investing in anything if we cannot afford to lose. So let our dreams begin.....
Professional alternative asset manager. I run a very flexible, truly agnostic deep value and special situations strategy with a 10 year track record and 15% IRR. Based in London, global network. Ex investment banker-20 year career as a cross-asset derivatives specialist with UBS, Morgan Stanley, BoAML.
Value Investor in Energy, Real Estate, Transport, Retail, Manufacturing, Media, Finance & Insurance
2014-today: Burggraben Holding AG, Value Investing
2006-2014: Babcock & Brown, Private Equity Investor for infrastructure & energy assets
1997-2001: UBS Warburg, Associate Director Corporate Finance,
Operational Background: 2008-2012: Board Member & Controlling Shareholder Imperial Parking Corporation, parking services, Canada 2008-2011: Board Member Coinmach Services Corporation, laundry services, USA 2011-2012: CEO Gutta International AG, manufacturing of Bitumen Roofing Sheets, Switzerland 2004-2006: CEO & Owner Mewag AG, manufacturing of tube bending machines, Switzerland 2001-2003: COO Obtree Technologies AG, content management software, Switzerland
I only look at stocks that have the possibility to double over a twelve month period and stocks in which the risk/reward ratio payout is high. In addition I focus on swing trade opportunities. I focus more on valuations and risk/reward metrics as opposed to what make companies tick. I have been a professional investor for over 20 years and during the past several years an economics analyst and financial writer for capital.gr, the biggest economic news portal in Greece. I have managed money from time to time and have also done some seed venture capital projects in the past.
I study and play roulette for over a decade. I enjoy the adrenalin rush and I'm interested in the profit potential. But above all, I consider it an intellectual challenge equal to the highest intellectual achievements. Let us share knowledge and camaraderie.