Old School Value Nugget Fest (June 6th Edition)

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Markets & Investing

• Buy And Verify (MicroCapClub)
  Our friends at MicroCapClub share their investment mistakes. “The ‘Coffee Can Portfolio‘ approach to investing might work for larger companies, but it’s the surest way to go broke in small microcap companies. Small microcaps evolve in different ways, and a lot of the ways aren’t good ways.”
• Fracking Stocks Less Popular Than When Oil Was $10 (Bloomberg)
  “The optimist with a long memory would remember that late-1990s kick in the teeth as marking the start of a decade-long super-cycle for oil prices (and equities), as well as a lost decade for overheated tech stocks.”
• Confessions of a “Financial Advisor”  – two guest posts from the insurance industry [The White Coat Investor]
  “Prior to reading Ramsey’s book, I knew basically nothing about finance, but soon my wife and I were working our way through Ramsey’s ‘Baby Steps.’ Dave recommends that you work with a financial advisor, so we used his “Endorsed Local Provider” search to find someone we could trust.”

Book List

• The 22 most important finance books ever written (Financial Post) 
  We have our own OSV list here. If you want more must-read finance book list click the link above for classics.

Behavioral Finance

• 5 Classic Behavioral Biases You Should Be Aware of (The Market Plunger)
  1. Anchoring 2. Confirmation 3. Recency 4. Herding 5. Overconfidence

Quote of the Week

“Einstein was right about relativity, but even he would have had a difficult time applying relative valuation in today’s stock markets.”

– Prof. Aswath Damodaran

Podcasts of the Week

Meb Faber Episode #158: Tobias Carlisle, “The Way To Get The Best Performance Is To Concentrate Into Industries When They Get Cheap”
Great overview from Toby of his new Acquirers Fund ETF, and how we selects stocks for it.

The Acquirers Podcast: Jim O’Shaughnessy – What Works, Legendary Entrepreneur, Investor And Author
In the Meb podcast, Toby mentions his latest pod with Jim O’Shaughnessy, which is also really interesting.

Overcoming Biases for Effective Decision-Making (Value Investing w/ Legends) [56 minutes a long commute or a long run]
Mentioned in this Episode:
Michael Mauboussin’s Website Michael Mauboussin’s Books BlueMountain Capital Management Alfred Rappaport’s Book | Creating Shareholder Value: A Guide for Managers and Investors Journal Articles: Franklin Allen | Do Financial Institutions Matter? Solomon E. Asch | Opinions and Social Pressure Sanford J. Grossman and Joseph E. Stiglitz | On the Impossibility of Informationally Efficient Markets Scott Page, Leonid Hurwicz & more.