Author Topic: Fairfax return over the next 10 years  (Read 6411 times)

Partner24

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Fairfax return over the next 10 years
« on: June 05, 2009, 06:55:50 AM »
Please don't try to be overconservative, just the most likely range of return that you truly think. Also, keep in mind that this poll is anonymous. The results will be shown in 5 days. Cheers!


alertmeipp

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Re: Fairfax return over the next 10 years
« Reply #1 on: June 05, 2009, 07:10:23 AM »
how come there is no negative #? :)

FFH is going down no matter what the market does.

UhuruPeak

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Re: Fairfax return over the next 10 years
« Reply #2 on: June 05, 2009, 07:28:03 AM »
how come there is no negative #? :)

FFH is going down no matter what the market does.


FFH is uncorrelated to the market.  It goes down when Sanjeev diets, and goes up when he lunches :)

Partner24

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Re: Fairfax return over the next 10 years
« Reply #3 on: June 05, 2009, 07:57:16 AM »
how come there is no negative?

Oopss. I tought that I had only 5 options available. :-[

But if someone think that it would be less than zero, please email me to "post" your vote and I will keep your name confidential. I will adjust the final results with these votes.

Cheers!

Partner24

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Re: Fairfax return over the next 10 years
« Reply #4 on: June 11, 2009, 04:51:24 AM »
Here are the results.

- 54 voters (none have sent me email to vote for less than zero).

- Highest votes for a given range: 16-20%

- Mean: 17,3%

Thank you for voting!

Cheers!

Uccmal

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Re: Fairfax return over the next 10 years
« Reply #5 on: June 11, 2009, 07:08:15 AM »
At some point closer to the ten year mark than now I expect that their returns will start to drop below 15%. 

and

Are we collectively overly optimistic? 
GARP tending toward value

calonego

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Re: Fairfax return over the next 10 years
« Reply #6 on: June 11, 2009, 08:03:57 AM »
FFH is at 260 now - it will be at almost 1300 in a decade if the 17.3% is correct - that may not be too far off, up or down, although my guesstimate would be a lower return. If you take a point in exactly 120 months - who knows where it's at (very dependent on the state of the economy at that exact time, etc). But there is a likelihood that in the interim a number like that is attainable (and a higher "now-to-peak" return).
At 26%/annum, it would be trading at over $2,600...
« Last Edit: June 11, 2009, 08:07:42 AM by calonego »
JC

oldye

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Re: Fairfax return over the next 10 years
« Reply #7 on: June 11, 2009, 11:27:29 AM »
Its simply a function of whether or not they can keep investing capital at 15+%, without knowing the future its impossible to tell if that will happen.  Heck if the shares stay this cheap for the next 10 years, they'd have no problem earning 25% a year.

ERICOPOLY

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Re: Fairfax return over the next 10 years
« Reply #8 on: June 11, 2009, 04:49:35 PM »
I think that you get roughly $1 of equities for every $1 invested in FFH at today's price.

It seems like a 12% return on their equity portfolio over the next 10 years will get you 17% return on the stock if you assume:
1)  a modest expansion of B/V multiple (say 1.2x) to offset taxes paid/due on the equity gains
2)  5% per annum boost from the float (pretty easy this year with the tax-free muni bonds)

So is a 12% return possible? 

ubuy2wron

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Re: Fairfax return over the next 10 years
« Reply #9 on: June 12, 2009, 11:58:25 AM »
Its simply a function of whether or not they can keep investing capital at 15+%, without knowing the future its impossible to tell if that will happen.  Heck if the shares stay this cheap for the next 10 years, they'd have no problem earning 25% a year.

Oldeye you do not have to know the future only Prem has to know the future, given his investment calls in the last three years I suspect that he has made a pact with the devil to get a copy of the WSJ delivered every morning 3 years in advance. LOL