October 10, 2007 by Joe Ponzio

I’m a business owner so I know what it means to be cheap. Okay, that sounded bad; still, I like the philosophy of “why pay for what you can get for free.” In business, just as in your personal finances, cash is king-so you don’t want to blow it unnecessarily.…

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October 9, 2007 by Joe Ponzio

If you aren’t familiar with beta, it is the measure of a stock’s volatility in relation to the rest of the market. If a stock has a beta of 1, it tends to move up and down at the same pace as the markets. Stocks with a beta greater than…

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October 4, 2007 by Joe Ponzio

Some 50 years ago, John Larry Kelly came up with a formula to determine how much you should bet on a gamble or investment to optimize your bankroll. Now known as the Kelly Formula, the equation determines the optimal percentage of your cash to bet on a favorable bet. Mohnish…

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October 2, 2007 by Joe Ponzio

Before we ever crammed into the conference hall for the meeting and Q&A session, Mohnish was chatting it up with investors and prospective investors (and fans) in the half hour meet-and-greet. I arrived 15 minutes early and the room was already half full (or half empty if you are a…

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October 1, 2007 by Joe Ponzio

I went to the Pabrai Funds annual meeting on Saturday, armed with some of your questions. It is often good to bounce ideas and questions off other business investors, and you can’t argue this Buffett disciple’s 30+% average annual return for the last eight years. Mohnish Pabrai-manager of a $600…

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September 27, 2007 by Joe Ponzio

When buying a business, you are essentially becoming a silent partner in that business. Sure, you have a say in the meetings and you get the annual reports; still, you don’t have any real control over the day-to-day operations or the allocation of the company’s (your) cash. When a company…

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September 26, 2007 by Joe Ponzio

A few visitors have asked me to review Mary Buffett & David Clark’s Buffettology: The Previously Unexplained Techniques That Have Made Warren Buffett The World’s Most Famous Investor. It had been years since I read it-eight, in fact. So, I had to take a day to revisit it (hence no…

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September 24, 2007 by Joe Ponzio

Thanks all for your feedback-both in comments and e-mails. Let’s start from the top: Babui asked for more examples on how price follows value and how buying and holding through drops can still allow you to come out ahead. Today, let’s look at another example: Procter & Gamble.

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September 21, 2007 by Joe Ponzio

Hi all. A couple of quick points as I won’t be doing a full post today. Reason: I am out raising money for our charity-today we’re helping raise money for intellectually disabled children. I’ll be walking up and down the streets in a bright yellow smock, handing out tootsie rolls-if…

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September 20, 2007 by Joe Ponzio

The decision to buy stock in a company is fairly straightforward. Is it a great business? Is it trading at a significant margin of safety (MOS)? Am I confident in my valuation and assessment? Answer “yes” to those questions and you’re on your way to business ownership. But when do…

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