Protect the downside. Worry about the margin of safety. Peter Cundill More Quotes by Peter Cundill More Quotes From Peter Cundill Just as many smart people fail in the investment business as stupid ones. Intellectually active people are particularly attracted to elegant concepts, which can have the effect of distracting them from the simpler, more fundamental truths. Peter Cundill smart stupid people You find bargains among the unpopular things, the things that everybody hates. The key is that you must have patience. Peter Cundill having-patience hate keys The share price must be less than book value. Preferably it will be less than net working capital less long term debt. Peter Cundill debt long book 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. Peter Cundill individual half art The difference between the price we pay for a stock and its liquidation value gives us a margin of safety. This kind of investing is one of the most effective ways of achieving good long term results. Peter Cundill safety differences long 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. Peter Cundill optimistic running people I try to keep in mind Oscar Wilde's comment that "saints always have a past and sinners always have a future," so no investment should be ruled out simply on the basis of past history. We focus on liquidation analysis and liquidation analysis alone. Peter Cundill focus mind past I think that intelligent forecasting (company revenues, earnings, etc.) should not seek to predict what will in fact happen in the future. Its purpose ought to be to illuminate the road, to point out obstacles and potential pitfalls and so assist management to tailor events and to bend them in a desired direction. Forecasting should be used as a device to put both problems and opportunities into perspective. It is a management tool, but it can never be a substitute for strategy, nor should it ever be used as the primary basis for portfolio investment decisions. Peter Cundill intelligent opportunity thinking All we try to do is buy a dollar for 40 cents. Peter Cundill cents dollars trying If it is cheap enough, we don't care what it is. Peter Cundill dont-care care enough The price earning multiple must be less than ten or the inverse of the long term corporate bond rate, whichever is the less. Peter Cundill corporate-bond earning long The most important attribute for success in value investing is patience, patience, and more patience. The majority of investors do not possess this characteristic. Peter Cundill investing majority important The company must be paying dividends. Preferably the dividend will have been increasing and have been paid for some time. Peter Cundill company has-beens paid Sooner or later, the market will do what it has to do to prove the majority wrong. Peter Cundill sooner-or-later majority prove 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. Peter Cundill lucky play ideas There will be losing years; but if the art of making money is not to lose it, then there should not be substantial losses. Peter Cundill loss years art To put money into anything, anywhere, provided that the downside is measurable and acceptable and the chances of a good profit appear to be better than 50%. I will not take gambles, but it is part of my job description to be ready to take very carefully calculated risks. Peter Cundill risk chance jobs To my knowledge there are no good records that have been built by institutions run by committee. In almost all cases the great records are the product of individuals, perhaps working together, but always within a clearly defined framework. Their names are on the door and they are quite visible to the investing public. In reality outstanding records are made by dictators, hopefully benevolent, but nonetheless dictators. Peter Cundill running doors reality There is always something to do. You just need to look harder, be creative and a little flexible. Peter Cundill creative looks needs What differentiates us from other money managers with a similar style is that we’re comfortable with new lows. Peter Cundill managers style lows
