Carl Icahn Profile

Fortune has a cover story on the most famous corporate raider of our time, Carl Icahn.

When Zander arrived, the 71-year-old Icahn ushered him into his immense suite, a paneled aerie overlooking Central Park festooned with museum-quality antiques, portraits of European gentry, and an exquisite portrait by French master Camille Corot. It resembles the drawing room of a British aristocrat, exuding the air of overwhelming wealth and confidence that Icahn - lord of $12 billion in investment capital - summons to bend CEOs to his will. "I told Zander the truth," recalls Icahn. "I said, 'You have a great company. Why did you screw it up?'"

Ken Heebner of CGM Funds Profile

Kiplinger calls Ken Heebner the savviest stock picker in America. Yes this is the guy who runs the funds with the corny fencing commercials. His Focus Fund has crushed the SP500 by 13% annually in the last 10 years.

What's the common thread in your approach to stock picking? I look for fundamental developments that will cause a stock to significantly outperform the market. So I look for companies that will surprise on the upside.

Profile on Lou Simpson, Buffett's Lieutenant

Morningstar has a profile on Lou Simpson. He's been beating the SP500 by 7% each year for a few decades. Lou's core strategy is to buy "growing businesses at value prices."

Simpson repeatedly stressed the importance of understanding the negatives associated with a potential investment or, as he put it, knowing "why not to buy something." This, he felt, was one of the keys to validating a given investment idea, as it confers a much deeper understanding of the underlying businesses concerned.

Bill Gates' Money Manager

Learn how Bill Gates' money manager invests. Their target annual return is 5%. You aim low when your main goal is not to lose tens of billions of dollars.

Michael Larson, a former bond-fund manager with Putnam Investments, is the financial engineer and stock picker behind that historic undertaking. As head of Bill Gates Investments, the 46-year-old Larson oversees Gates' personal wealth, which is housed within Cascade outside Seattle. At the same time, BGI is also responsible for the $32 billion Bill & Melinda Gates Foundation.

Motley Fool Interviews Mohnish Pabrai

Motley Fool interviews Mohnish Pabrai, a value fund manager who likes the Buffett style of investing. He says his fund has been up 28.6% annually for last 7 years. Not so shabby.

The No. 1 skill that a successful investor needs is patience. You need to let the game come to you. My steady-state modus operandi is to assume that I'm just a gentleman of leisure, and that I'm not in the investment business. If something looks so compelling that it screams out at me, saying "Buy me!!," I then do a drill-down. Otherwise, I'm just reading for reading's sake.

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Berkshire Hathaway 2007 Annual Meeting Transcript

Matt at BankStocks.com does a fantastic transcript of the annual Woodstock for Capitalists.

Q: What’s a good way to become a better investor?

WB: Read everything you can. I read every book on investing in the Omaha Public Library. Fill up your mind with competing thoughts and decide what makes sense. Then jump in the water and start investing real money, rather than a paper portfolio. The difference between investing real money and is the same as reading a romance novel and actually dating. There’s nothing like experience. The earlier you start, the better.

Glenn Greenberg of Chieftain Capital Lecture

Listen to Glenn Greenberg of Chieftain Capital give a lecture to Columbia Business School students on March 28th, 2006. He's an investing legend.

Real Media Video Stream [You need a player that can play Real Media Videos]

Some basic learnings:

-You need an approach that over long-term will win and not utterly fail even during 100 year hurricane. If you have a strategy that can make explosive money, but blow up in any given year, it doesn't matter. Buffett likes to say: 100% X 100% X 0% still equals 0%.
-Only one approach that makes sense to him: Buy good businesses, reasonably predictable, necessary businesses, don't have high rate of change, figure out paying a under-valued price given the long-term prospects.
-Was an English major. Was a teacher during Vietnam War. Went to Columbia Business school. Then worked JP Morgan - 2 years in research as money "mis-manager". 150 growth stocks in the portfolio. Left to work for family office, Central National, for 5 years. Learned how to look at companies and how to take them apart.
-Don't trust other people's research is a mistake. Best thing to learn is "to do your own work."
-After 10 years in the business started Chieftain Capital with $40 million (about $26 from family and friends). Will never market again. Will never ask Wall Street to call them up with their investment ideas. Told clients we don't have time to meet with you. Maybe meet once a year. Spend time "doing research."
-Early on 100% invested. 3-4 ideas. Last 8 years, 30% in cash. Hedge-funds used get you 25-30% after fees. Today people invest 2/20 to get 8-10% after fees.
-Occasionally come across a business that was "wildly mis-priced." Is it a great business at a cheap price?
-Chieftain owns 6-12 stocks. Normally fewer than 10 stocks. Focus on U.S. stocks.
-We don't do relative valuations. Look for 14-15% rate of return. Buffett even looks at 13% EBIT return or 7-8Xs pre-tax (but he has low cost of capital due to insurance companies).
-Study company carefully, be confident in your analysis. Many of his stocks imploded after they bought it, but bought more lower and made more money.
-Huge fan of periodicals, read 4-5 newspapers a day, magazines, and trade magazines. Most information comes from reading and talking to smart people. However journalism standards have gotten worse, point of view has to be "punchy" and take an extreme stand.

Warren Buffett Investment Strategy - The Simplified Version

I've read a ton of Buffett related books, interviews, annual reports, original partnership letters, etc. Here's his strategy boiled down to the basics:

1. Do you understand the business? Stick to your "Circle of Competence". If you don't know what your "edge" is, you don't have an "edge".
2. Does it have "durable competitive advantage" or in other words "a moat"? Companies in this camp have a great brand, a franchise, high returns on equity and returns on invested capital, and pricing power. Buffett likes to ask if someone spent $1 billion on trying to build a competitor, would it make a "dent" on the business? If no, it has a good "moat".
3. Do we like the people that run it? Honest and able management. Life is too short to deal with bad people.
4. Does it sell for a price that is attractive? He bought See's Candies for 6Xs earnings. He bought Korean stocks a few years ago at 2Xs earnings. He bought Connoco Phillips at 6Xs earnings. He bought PetroChina at 5Xs earnings and a 10% dividend yield.

The above is his primary core strategy these days. In the past he did more micro-cap "cigar butt", arbitrage, and activist type things.

Warren Buffett MBA Talk

We're huge fans of Warren Buffett. Here's a talk he gave to some MBA students. Lots of wise vignettes in there.

Video Link

Wall Strip Video Blog

Wall Strip video blog is hip, funny, and informative. Every day they talk about a stock that has hit a 52-week high and why it's there. It may not be the best investing strategy, but at least you learn about a new company each day. The show just got bought by CBS. Nifty move big media!

Warren Buffett on Charlie Rose

More classic Buffett videos for your viewing pleasure [Source: Dah Lui Lau]

Video Link 1 - May 10th, 2007
Video Link 2 - June 26th, 2007