Peter Cundill Quotes
You find bargains among the unpopular things, the things that everybody hates. The key is that you must have patience.
Why will someone sell you a dollar for 50 cents? Because in the short run, people are irrational on both the optimistic and pessimistic side.
When a stock doubles, sell half - then what you have is a free position. Then it becomes more of an art form. When you sell depends on individual circumstances.
There is almost always a major blip for whatever reason and we have learnt to expect it and not to panic.
The most important attribute for success in value investing is patience, patience, and more patience. The majority of investors do not possess this characteristic.
The company must be paying dividends. Preferably the dividend will have been increasing and have been paid for some time.
The share price must be less than book value. Preferably it will be less than net working capital less long term debt.
They really can’t afford to be contrarians. A major investment house can’t afford to do research for five customers who won’t generate a lot of commissions.
I suspect that my thinking is an eclectic mix, not pure net-net because I couldn’t do it anyway so you have to have a new something to hang your hat on. But the framework stays the same.
Long term debt and bank debt (including off-balance sheet financing must be judiciously employed. There must be room to expand the debt position if required.
The price earning multiple must be less than ten or the inverse of the long term corporate bond rate, whichever is the less.
We always look at the margin of safety in the balance sheet and then worry about the business.
Try to pick a fund manager who has a well-defined strategy, has been through these things before, and go invest and stay with him.
I’m lucky to have the kind of life where the differentiation between work and play is absolutely zilch. I have no idea whether I’m working or whether I’m playing.
The company must be profitable. Preferably it will have increased its earnings for the past five years and there will have been no deficits over that period.
What differentiates us from other money managers with a similar style is that we’re comfortable with new lows.
There will be losing years; but if the art of making money is not to lose it, then there should not be substantial losses.
There is always something to do. You just need to look harder, be creative and a little flexible.
The price must be less than one half of the former high and preferably at or near its all time low.
