원문 보기
so I don't think the reason people don't beat the market is because the market is efficient or even close to efficient or not emotional it's very emotional or that it can't be done there's all kinds of institutional and agency reasons and tons of other reasons why they don't do it but because prices are efficient if you just pick up the paper or observe what's going on or listen to what I told my students since you know when they were 10 years old it's pretty clear that people are still crazy and there's opportunity out there you wrote the book on special situations investing enumerating a number of ways to make money from spin-offs Recaps reorgs bankruptcies mergers and the like given that you wrote the book and thus there were no books before you wrote yours how did you figure out how to invest in this way how did you figure out what was important and where you could and couldn't make money well you're right that is a great question um well I actually started my first job was with uh they didn't call them hedge funds back then but it was with a risk Arbitrage firm and Miss garbage otherwise known as merger Arbitrage involves buying a company after a merger deal is announced and hoping that it closes and generally the risk reward in that business is uh well if it the merger closes you make a dollar and if it breaks you lose 10 or 15 dollars and that risk reward wasn't that appealing to me um and so I started looking for other ways to do it so I looked for a mergers that had interesting Securities I uh you know coming off uh you know the way they were paying for the merger I looked for uh extraordinary events happening within companies whether recapitalizations or spin-offs or anything where I could get out of the business where I could make a dollar and lose 10 or 15.
and so I was just looking for uh things that were a little off the beaten path I really started learning when I was at Wharton and at the time uh uh Wharton was really in the efficient market Camp the way they were uh teaching things and it didn't resonate with me and my junior year I happened to read an article about a guy named Benjamin Graham and as soon as I read that article I said ah this makes sense to me and uh I started reading everything that he wrote and started looking at the world really through a different lens and that lens was not the first job I took which was risk Arbitrage it was really looking for uh figuring out what something is worth and paying a lot less leaving leaving a large margin of safety and so these special situations gave me that opportunity I opened up um I opened up that book you can be a stock market genius one of the worst titles ever given to a book it was supposed to be any fool can be a stock market genius and then my editor had the motley fools at the time which was very popular so he said oh you can't use the word fool and so my dad said how about you can be a stock market genius and then in parentheses even if you're not too smart and so I giggled a little bit and they only gave me a day to change the title so I just went with it and uh that wasn't a good choice but I but uh but I but I uh opened the book with a story about my in-laws who spend uh they used to live in Connecticut uh for part of the year and they would spend their time antiquing uh going to Country auctions going to tag sales uh and they were looking for art and antiques that were undervalued um and when they found a painting at a country auction or at a tax sale they the question they asked was if they saw a painting by an artist and they had seen that that artist had just gone for auction with a similar type painting similar size similar genre whatever it was and it had sold at auction recently at two or three times the price that they could buy it for they would go buy it that's a lot different question than asking uh is this painter going to be the next Picasso that's a much harder challenge so I opened the book saying special situation is a little like that you know you don't want to be so smart to know who's going to be the next Picasso you sort of want to look a little off the beaten path because this is a little more obscure it's smaller market cap it's something strange is going on and the normal people who follow this aren't going to look at it because it's too complicated or you got to read a 400 page thing or uh you know the piece being spun off is is not really why people bought the original stock in the first place it's for the small not for the little small business that's being spun off so these were discarded things so it was my way of making the challenge easier finding things that were selling well below their fair value you know it wasn't so much um you know I finished that first chapter of you can be a stock market genius with a story about the plumber who comes to your house and uh bangs on the pipe once and says that'll be 200 you know fixes your pipes and says that'll be two hundred dollars and and uh you say to the plumber what do you mean 200 you came here and banged on the pipe once he says oh no that's only five dollars it's 195 dollars to know where to bang so so that's how I've used special situation investing just making the challenge easier and so uh I'd rather be a little not as smart and a little bit lazy but go for you know Warren Buffett would call them one foot hurdles why go around looking for 10 for foot hurdles to jump over if you could find some one foot one so I don't have to be all that smart to be good if I'm looking in the right places you know Joel I wrote a memo in uh January of 14 called getting lucky and I told the story of a guy who was working on becoming a better poker player so he's working on learning the odds of getting the cards you need the odds that the hand you had would beat other hands the Tells that tell you whether the other side is bluffing or not and his uncle said to him you're wasting your time trying to become a better poker player why don't you just find an easier game and it sounds to me like what you did is look for what you thought were easy games yeah it's uh you know the last story I told in the book that illustrates the same point is uh I tell a story that I lost a bet and the loser had to take uh the winner to the best restaurant in New York at the time it was the test there was a chef there Andre saltoner which at the time was considered probably the world's greatest chef and so uh first I called up and they wouldn't give me a reservation you know I thought I said I'll take any time any day and they said sorry I I I I I didn't understand that and and it turns out you know there's some 30-day period where they'll only book for 30 days and they were all booked so I kept calling back finally got in we get to the restaurant and I wasn't really pension paying attention to who came over to take my order but I uh pull out my manual and point to one of the after appetizers and I said innocently uh is I pointed to one and I said is this one any good so Andre saltner turns to me and says no it stinks so uh you know best chef in the world I'm asking if you know this thing he just cooked is is any good and so the point was I think the point he was making was everything on the menu is good this is the best restaurant in the world uh and so I try to shop in in the best places where almost everything uh is good and I just have to discern between a bunch of different good things so Joel you you mentioned buying things for a lot less than they're worth and that that provides the margin of safety yeah um would you say that those are the core elements in value investing and and do you want to enhance that definition uh any or is that enough um well and one other question you mentioned that you didn't think it would be a great idea for your in-laws to try to find the next Picasso would you analogize that to growth investing um sometimes I mean uh my definition of value investing is figure out what it's worth pay a lot less it has nothing to do with low price book or low price sales and so that's how a lot of people like Russell or Morning Star would classify value investors and so they probably wouldn't classify me as a value investor or a growth investor they kind of don't know what to do with us and you know as Buffett has said you know growth and value are are tied at the hip I mean uh part of what makes value is is by investing in a business that can grow over time so they're they're not two different uh the way they're classified by let's say Morning Star Russell maybe there's much lower growth in value and and much higher growth and growth and that they they make it that way but I I'm looking for good businesses that are cheap you know Ben Graham said figure out what it's worth pay a lot less leave a large margin of safety uh between those two big space between those two things Warren Buffett his best student made one little twist that made him one of the richest people in the world buff it simply said if I can buy a good business cheap even better part of good is a business that can grow over time and so um I slowly gravitated not not fast enough I you know certainly in my first decade of investing gravitated more towards the way that Warren Buffett invests he's looking for good and cheap businesses and growth is is part of uh sometimes being good but at the beginning Buffett wasn't so entranced with good businesses he was famous for starting off with the cigar butt approach where he wasn't looking for equality he was just looking for cheapness but then he too made a transition yeah I mean my Master's thesis at Wharton or it turned into that uh with uh my friend Rich pazina and Bruce Newberg was a a paper we wrote that eventually got published in the Journal of portfolio management about buying cigar butts you know they were called net Nets buying stocks selling below their liquidation value uh and showed that just buying if you bought it cheap enough you could make nice money and and that's sort of the way Warren Buffett started but when you think about why we moved to towards quality let's say you find a stock that's worth ten dollars and it's selling at six it's pretty cheap uh but if you're not controlling the business uh and it's not in a good business your margin of safety May erode over time meaning that ten dollars could turn to eight if you're not really controlling those assets and what you're really looking for are businesses or what looks better to me anyway or businesses where that ten dollars might be growing to 11 or 12 increasing your margin of safety so uh I might take a lower margin of safety if I thought that was growing uh but there's there's more buying things cheap works I mean cheap alone works I have nothing against it it's just that you have to get out of it so Buffett who runs 100 billion dollars or some number like that it's not easy to go spend 5 billion and then go sell it to some other guy who's gonna you know pay you more than the 5 billion it's too big so when he was and he said as recently as uh you know around year 2000 he said well if you give me a million dollars uh I can make 50 a year on that there's plenty of opportunities your opportunities set shrinks as the businesses become larger if you can invest in anything you know if you don't have a lot of money you can invest in thousands and thousands of businesses Buffett is now looking at the top 300 businesses in size because uh the smaller ones aren't they won't move the needle so there's a lot you can do in special situations one thing a lot of my students asked me uh you know when it happened it happens every year now probably for the last five or six years and they and uh the question they asked me at some point in the semester is that you know when you were younger because you're really old they leave that part out but you're really old and when you were younger things were easier that goes unsaid yeah well I just said it but anyway uh uh things were easier there was less competition there were less hedge funds there were less computers there were less smart guys going into this business I mean when I got into it I was telling Howard before Market hadn't gone up in 13 years by the time I got to Wall Street so it wasn't a place that really was attracting lots of people uh so they said it used to be easier for you but you know it must be harder for you know hey you stupidly wrote a book about this and there's a lot of people doing this now not just because of that obviously um you know it's harder for us you know you you got the easy stuff and so my response is this people who are very good especially in this special situation I have two responses one is uh people who are good at special situation investing really looking off the beaten path uh for liquidations or recapitalizations or spin-offs or any of those things many of them are liquidity constrained you know Warren Buffett started making a lot of money doing those things but he grew too big and so I asked I tell them that listen you know what happens to people who get very good at analyzing businesses in this area uh what happens to them is they make a lot of money and they get too big to stay in this area so there's always a new group of people who can come in and look at some of those smaller situations because the guys who are really good at it get too big to to Really take advantage of some of the smaller or more obscure situations and so there's always room for new people to come in that area and then on a larger scale uh you know because people still teach efficient markets and they'll say Hey you know acting investing doesn't work and even Warren Buffett's saying go buy some ETFs or you know indexes and and everything else and what I'll say is uh that for most people that's true because they don't know how to Value businesses but I will give you a counter and this is what I tell my students most of my students around 27ish or something like that so I said I tell them all let's go back to when you were roughly uh 10 years old where you might start noticing some of this thing and let's go look at the most followed Market in the world and that would be the United States and let's go look at the most followed stocks in the most followed world in the most followed Market in the world and that would be the S P 500 stocks to a large extent let's take a look at what happened since you were 10 years old take a look at the S P 500 from 1996 to 2000 it doubled from 2000 to 2002 it halved from 2002 to 2007 it doubled from 2007 to 2009 at halved from 2009 till today it's basically tripled that's my way of saying people are still crazy that's really unfair thing to say because this S P 500 is an average of 500 stocks there's huge dispersion going on within that average between stocks that are in favor that people love emotionally and stocks that people hate so it's really much worse than what I just described there's huge dichotomy between things people like and people don't things that are in favor out of favor within that that is all this noise is going on within that average that average is smoothing things so if you believe what Ben Graham said is you know here's fair value and here's what the market prices are it's like a wave around fair value and if you have a disciplined way to Value companies and buy more than your fair share when they're down here and sell some maybe if you're shorting and when and you're very disciplined I mean uh I make two guarantees to my students first day of class first guarantee is this if they do good valuation work I guarantee them the market will agree with them I just don't tell them when could be a couple weeks could be two or three years uh but I tell them the market will agree with them and the and the corollary to that is this and it's very powerful I tell them in 90 of the cases for an individual stock two or three years is enough time for the market to recognize the value they see if they've done good work when you put together a group of companies that actually on average is actually happening quite a bit faster so um you know both those are very powerful it just says good work will be rewarded so I don't think the reason people don't beat the market is because the market is efficient or even close to efficient or not emotional it's very emotional or that it can't be done there's all kinds of institutional and agency reasons and tons of other reasons why they don't do it but because prices are efficient if you just pick up the paper or observe what's going on or listen to what I told my students since you know when they were 10 years old it's pretty clear that people are still crazy and there's opportunity out there
댓글 0