I first learned of Dr. Weiss from a guest lecture that he gave at the Business School in Columbia University.
I was deeply impressed by that speech and decided to learn more from Dr. Weiss.
It turns out that Dr. Weiss is not only an economist but also a hedge fund manager. Below are what significant people said about him.
"If I had one person to pick and one guy to put the money in, I would pick him."--Prof. Bruce Greenwald, who taught value investing at Columbia University.
"[Weiss] is a significant person among US economists. I have known him personally for 30 years and I have the highest respect for him."-- Robert Solow, Nobel Prize Laureate in Economics
Below is the note that I took from a speech delivered by Dr. Andrew Weiss at Boston University.
Don't under any circumstances:
1. Buy stocks or bonds from someone who is cold calling you. Especially if they are working for a firm that is not known to you.
2. Put your money in a discretionary account- an account in which the broker can trade without your permission
3. Buy bonds on the secondary market unless you are buying at least $50,000 worth and have gotten at least 3 quotes from different dealers
4. Buy open end mutual funds with high expense ratios. The expense ratio should be less than 0.75% per year for domestic funds and less than 1.5% for foreign funds.
5. Buy a mutual fund with a load or redemption fee.
6. Put your money in a wrap account- an account in which the broker gets a 3% annual fee for managing your money
7. Trade on the bases of past price patterns (except for tax considerations) or on the basis of what you paid for the stock. (The people to whom you hope to sell your stock don not care what you paid for the stock and your aim is to get more for your stock than you paid for)
8. Speculate in commodities
1. Having a significant fraction of your wealth in the stock of your employer
2. Investment whose value is likely to be low when you need money. These are stocks whose values are correlated with the value of your job or home.
3. Full service stockbrokers
4. Buying mutual funds with high portfolio turnover rates
5. Story stocks- the next cure for cancer, a cure for aids, the solution to the most important problem confronting America. Even if the story is right you still have a good chance of losing a lot of money. UNIVAC (mainframe), Commodore computer (PC) and sea-land (container shipping) were all at the “cutting edge of a revolutionary technology.” They were each terrible investments
1. Diversify to protect yourself against unlikely events. Remember that unlikely is not impossible.
2. Diversify across common stock with very different characteristics. Stocks in different industries and different countries. A collection of very different risky securities can be a much safer portfolio than a portfolio of “blue chip” investments. The Pennsylvania railroad and the new York central railroad, eastern airlines, Bethlehem steel, General Motors, Poloroid, US Lead, were once blue chip investments. Diversifying across countries buying shares in Canadian and UK companies does not give adequate diversification across different countries. Invest in markets that are not highly correlated with US.
3. Sell your losers to take tax loses.
4. Buy securities that have lower prices relative to their earnings or assets.
5. Read the latest 10K and 10Q reports for securities before you buy them. If your stockbroker won’t supply those reports get a different broker or go to the library.
6. Buy US savings bonds in preference to all other fixed income domestic securities (except junk bonds which should be viewed more as stocks) Why US savings bonds? Taxes are not paid until bonds are redeemed. Interest is 85% of 5 year T-bill rate and is recomputed every 6 months for first 5 years- protection against inflation. After 5 years bonds can be redeemed at any time at no penalty-minor penalties for early redemption you get to benefit from falls in inflation without being hurt by increases in inflation.
7. Construct your own mutual fund from stocks featured in mutual choice in Barron’s the favorite stocks of a mutual fund manager is described each week.
8. Buy stocks in companies about which you have some special knowledge- especially if those are companies that will do well if your own employer does poorly.
“I early on learned that any relationship between what they (stockbrokers) said would happen (to a stock) and what did happen was purely accidental.” Donald Baxter, manager of Philadelphia Fund and former stockbroker.
The original video can be found here.---Boston University Speech
孟格先生是真正令人佩服的人物! 但是老人家今年已經九十一歲了，我想或許這次波克夏股東會將是他一生最後幾次出現在公開場合裡。人人都有心中的英雄，看到自己的英雄或許將要離開，真是令人難過。 在2014年的給波克夏股東的信中，從第39頁起有孟格先生對波克夏之所以會有卓越的成就的看法...
1) Make decisions rationally 做決定時要理性的做決定 2) Invest in what we know 投資我們了解的標的 3) Worth with honest and trustworthy managers 跟誠實可靠的經理人同工 ...