In his 2010 shareholder letter, Warren Buffett wrote that his elephant gun had been reloaded, and his trigger finger was itchy. He was referring to Berkshire’s dry powder cash that was intended for major acquisitions. Extending the same metaphor, today I could say that my BB gun … [Read more...] about My gun is reloaded
DryPowder
A very short bear market?
I came across an interview that CNN’s Poppy Harlow did with Warren Buffett in September 2018. She said investors were worried about cracks showing in the U.S. economy after a long nine-year run. And then she asked if Buffett was worried about an imminent recession (4:50). To … [Read more...] about A very short bear market?
Market neutral investing
Last week, John Rekenthaler of Morningstar wrote an article on worst alternative investments of the decade. Market-neutral funds were among his top-five worst investments. Average annual return from the funds in this category was 0%. He wrote this, tongue in cheek: … … [Read more...] about Market neutral investing
Investing amid volatility: My 4Q update
What a quarter that was! The US stock market first reached a new high in October and then dropped 10%. It bounced around for a while. And then in late December, it dropped again—this time more than 15% off its peak. By some measures, it actually dropped 20% briefly (intra-day) … [Read more...] about Investing amid volatility: My 4Q update
Volatility is good for my investments
People fear double-digit stock market declines. I see them as opportunities. The US stock market has been more volatile lately. And my portfolio is better off because of this volatility. I just finished reading Nassim Taleb’s book Antifragile. He has got me thinking about my … [Read more...] about Volatility is good for my investments
Mid-year portfolio update 2018
Since my last quarterly update, there haven’t been many changes in my portfolio. Stocks have been on the rise since April this year -- making up for the losses in the first quarter. Looking further back, if I compare today’s asset allocation with what I had last year, there have … [Read more...] about Mid-year portfolio update 2018
Be mechanical about your investing approach
As I have written multiple times in prior posts, our gut instincts, friends’ views, media reports, and most expert opinions are really not that useful when it comes to investing. We, investors, consistently underperform even the ordinary index funds by as much as one-third due to … [Read more...] about Be mechanical about your investing approach
Revisiting my dry powder strategy
As I explained in my previous post on dry powder, I have cash that only gets deployed when stocks go down by a certain amount. How much cash to deploy and when? From the same post, you can see the rulebook I follow. If stocks follow historical averages, I may be able to deploy … [Read more...] about Revisiting my dry powder strategy
Quarterly portfolio update – March 2018
I don’t pay much attention to quarterly stock market changes. I don’t spend time trying to read tea leaves either. However, when the market goes down 10% or more from its peak, it spurs me into action. Why? As I detailed in this blog entry, I have a cash-as-dry-powder strategy. … [Read more...] about Quarterly portfolio update – March 2018
Get more out of your cash
Most of my capital is invested in stocks. You can see my portfolio here. I keep some cash as rainy-day fund and also for my dry-powder strategy. In today’s low-rate environment, cash does not return much. Short-duration CDs yield 1% to 1.5%. One-year treasury bonds return … [Read more...] about Get more out of your cash