Month: February 2020

Don’t Be Fooled By Your Dividend Bias – Sell Shares To Get “Income”

Introduction and summary: My idea with this article is to show that dividends are simply return of shareholders’ capital (a partial liquidation), exactly the same as selling the equivalent number of shares to create “income”. Admittedly, selling shares to support consumption feels a little like sawing off the branch I’m sitting on. Strangely enough, why doesn’t it feel the same about a

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Credit Acceptance Corp: Excellent Operators And Allocators – Great Compounder

Credit Acceptance Corp has proven to be disciplined loan underwriters, a prerequisite for good long-term performance. Has a clear and rational strategy for allocating capital. Owner-operated, meaning management has the same skin in the game as outside shareholders. Their business model sets them apart, and might turn out to be countercyclical in a recession. However, the industry is competitive and

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Comcast: A Recession “Proof” Compounder

Introduction and summary: Comcast (tickercode: CMCSA) is the world’s second biggest telecom company and headquartered in Philadelphia, USA. The company was founded by Ralph Roberts in 1963 and has largely grown via M&A. I’m long Comcast since late summer 2018 and consider this a long-term holding that will compound for years to come. My main reason for buying was twofold:

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Constellation Software – Takeaways From Mark Leonard’s Shareholder Letters

This article contains a brief description of Constellation Software, some thoughts on its competitive advantages and excerpts from Mark Leonard’s excellent shareholder letters. The excerpts are quite long, about 5 000 words, and I recommend going to the source to read all letters. This article has only small samples of Leonard’s wisdom. Mark Leonard: Mark Leonard, an Englishman and former

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The Perils of Selling Short

I signed my first client and proceeded to short my first stock. It almost proved to be my last. Over the next few weeks, I watched the stock trade up to 20, then 30, then 40, finally breaking through 50…..But when the stock climbed past 50, I started to cover, unable to stand the pain. It was too late, however,

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