Investment Ideas

I often visit sites maintained by outstanding money managers.  Why?

Insights into Decision-Making

The most important reason for doing so is to learn about their decision-making processes and their attitudes.

When I read their quarterly/annual reports, I am particularly interested in learning how the portfolios change through time.  The dynamic view shows how thinking processes work in practice.  In this respect, most portfolio managers are quite candid.  They comment on:

• their reasons for adding to or reducing positions in various holdings
• the weighting of holdings in their portfolios
• their attitude during periods of outstanding or substandard performance
• their perceptions of the macro environment and their reactions thereto

For me, this is pure gold ... better than investment texts.  You get to see how things work in practice.  For example, there are any number of books which have been written by one-off wonders - investors who have gotten lucky and who have capitalized on this by writing books to boast, to sucker people into attending their talks on the investment speakers' circuit or to trust their cash to them.  Sadly, when you peak at their portfolios later on (if indeed, they maintain investment funds) you will often see a record of substandard performance.  

This said, there are some truly outstanding investors with enviable long-term track records.  You can see a representative slate of these people here:

gurufocus

Investment Leads

Fund portfolios are wonderful sources of ideas for investment.  Consider that the managers have the combination of skill, deep experience and access to information that, sometimes, is not readily available to the average investor.  Further, they have the capacity to spend a lot of time in their search.  

All said, it makes sense to take advantage of their work and to incorporate some of their holdings into your investment portfolios.  There is no shame in emulating people who are successful.  This is done all the time in other fields of endeavour: golf, music ...

Here is a wonderful treatise on cloning investments:

Cloning Investments

It is posted in a blog entitled:

Canadian Value Investors

The blog has been added to the "favourite sites" sidebar on this blog.