Author Topic: Fairholme/Berkowitz  (Read 163410 times)

rjstc

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Fairholme/Berkowitz
« on: May 11, 2011, 10:30:34 PM »
   I have owned Fairholme since he first started the fund and Larry Pitowski and Keith Trauner were with the firm and they had less than $1Billion in their fund.

   I am bothered that Berkowitz is going from a tried and true record of good stock picking only, to getting into an operating company (St. Joe) situation. I don't like him getting bogged down that way even if he says he's backing away now.
   
   There are some good thoughts on this board. What are some on what's been going on lately. Thanks


PLynchJr

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Re: Fairholme/Berkowitz
« Reply #1 on: May 12, 2011, 05:36:32 AM »
Berkowitz is one of 2 or 3 mutual fund managers I'd be happy investing with.  Did you get a chance to listen to the conference call he did a few days ago? 

http://us.meeting-stream.com/fairholmecapitalmanagementllc_050911/

stahleyp

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Re: Fairholme/Berkowitz
« Reply #2 on: May 12, 2011, 07:07:29 AM »
I have a couple concerns with Berkowitz. Maybe they're trivial, but it's something to think about.

He's managing about $20 billion or so....and still refuses to close the fund. He is even advertising the fund on Morningstar. I can't think of many great value managers who advertise.

I wonder about his confidence a bit. He spent money writing that letter thanking the government for their support. I still don't understand what that was really about.

Paul

rjstc

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Re: Fairholme/Berkowitz
« Reply #3 on: May 12, 2011, 07:08:56 AM »
Plynch; I agree he is one of the best. I've been with him a long time and been very happy. Same with Mason Hawkins.

Vish_ram

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Re: Fairholme/Berkowitz
« Reply #4 on: May 12, 2011, 10:35:58 AM »
Berkowitz is one of 2 or 3 mutual fund managers I'd be happy investing with.  Did you get a chance to listen to the conference call he did a few days ago? 

http://us.meeting-stream.com/fairholmecapitalmanagementllc_050911/


thanks for the link. appreciate it.

FAIRX is the only fund I own and when I started investing it had less than 100MM. the only reason I invested at that time was it had high % of assets in BRK. I'm happy with the returns, but surprised that he hasn't reduced the fees.

I have the highest regards for Bruce Berkowitz for his ethics, patience, humility and lastly the returns.

locutusoftexas

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Re: Fairholme/Berkowitz
« Reply #5 on: May 12, 2011, 10:47:23 AM »
I am giving him some rope. He seems to mix characteristics of Buffett, Graham, and Phillip Carret -- old syle investors who understand (or understood) business. If this is a good analogy, he will stop taking money when he can no longer find good investments and when he has enough cash to buy bargains when markets go south. He claims to be comfortable with holding high levels of cash and should take profits when markets are getting hot. Remember that Buffett liked to acquire cash when the holding cost was very low, and that is the case now.

A danger signal would be low levels of cash near market peaks. That would be the time to "fire" Berkowitz as a person's portfolio manager. I don't know what his cash level is right now, but I am sure that there are still a lot of bargains in various global securities markets. Domestically I am not so sure, but I have trusted him to answer that question for at least a part of my money.

Tex

rjstc

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Re: Fairholme/Berkowitz
« Reply #6 on: May 12, 2011, 06:41:31 PM »
I am giving him some rope. He seems to mix characteristics of Buffett, Graham, and Phillip Carret -- old syle investors who understand (or understood) business. If this is a good analogy, he will stop taking money when he can no longer find good investments and when he has enough cash to buy bargains when markets go south. He claims to be comfortable with holding high levels of cash and should take profits when markets are getting hot. Remember that Buffett liked to acquire cash when the holding cost was very low, and that is the case now.

A danger signal would be low levels of cash near market peaks. That would be the time to "fire" Berkowitz as a person's portfolio manager. I don't know what his cash level is right now, but I am sure that there are still a lot of bargains in various global securities markets. Domestically I am not so sure, but I have trusted him to answer that question for at least a part of my money.

Tex
I agree. Sometimes they go outside their main expertise though. I think there are enough pure plays that he is better at than St. Joe. Ron

alpha23

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Re: Fairholme/Berkowitz
« Reply #7 on: May 12, 2011, 07:06:05 PM »
Berkowitz addressed this concern on the conference call. His take was something to the effect that his fund is invested mostly in what he became well acknowledged for to begin with (financials).

ericd1

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Re: Fairholme/Berkowitz
« Reply #8 on: May 12, 2011, 07:11:50 PM »
A couple members of his team recently set out on their own...

It remains to be seen how well they will do, but I think they bring a fair amount of experience to the table...and definitely smaller AUM.

"GoodHaven Capital Management, LLC is a registered investment advisor that began accepting new accounts in March 2011.  Larry Pitkowsky and Keith Trauner, former analysts, portfolio managers, and executives at Fairholme Capital Management, LLC and The Fairholme Fund founded GoodHaven believing we can make money for our clients and ourselves by using a focused portfolio management strategy and a value-investment philosophy."

http://goodhavenllc.com/Home_Page.html

rjstc

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Re: Fairholme/Berkowitz
« Reply #9 on: May 29, 2011, 09:54:45 AM »
He has over $200m of his own money in the fund. I believe he has "incentive".
I agree he sure does and I'm sure as good as he is he'll do well for himself and his investors. I guess my thought is Buffett as an example really try's not to get involved in operating company management and stays in his area of expertise which is capital allocation. For Berkowitz his is stock picking and such. I just wonder if he wishes he didn't have the St. Joe distraction.