Author Topic: Buffett/Berkshire - general news  (Read 522670 times)

roberts1001

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Re: Buffett/Berkshire - general news
« Reply #1330 on: September 08, 2019, 03:46:51 PM »
Makes me think about doing the same.  Buy a Japanese stock or fund and then hedge the currency risk using FX, receiving about 2% in interest on the USD/JPY FX contract (at current interest rates).  Maybe buying something like iShares Japan Value (EWJV) with a P/E of 9.77.

Or maybe something like UBS.  The Swiss stock market is expensive at a P/E of 22, but UBS has a P/E of 10, a P/B of 0.75 and a dividend yield of 6.35%.  Then hedge the currency risk using FX, receiving 2% interest on the USD bought and paying negative 1% on the CHF sold.

I'm not saying EWJV or UBS are good buys, or that FX hedging is a good idea, but it's something to think about.  Then again, maybe I should stick with what I have, which at this point is pretty much just BRKb and cash.

Wishing success to all.


gfp

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Re: Buffett/Berkshire - general news
« Reply #1331 on: September 09, 2019, 04:44:14 AM »
« Last Edit: September 09, 2019, 05:22:13 AM by gfp »

Cigarbutt

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Re: Buffett/Berkshire - general news
« Reply #1332 on: September 09, 2019, 04:52:03 AM »
Applied Underwriters sale information -
https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/53946178
2x return in 13 years! Not a great return unless Applied upstreamed a whole bunch of dividends to the mother ship over the years. Ajit & Warren are probably just getting rid of a "problem child".
Looking at various regulatory filings, it remains hard to get a clear picture but it appears that the acquisition was underwhelming. Underwriting results varied ++ from year to year and the lumpiness was not accompanied by very significant growth over the longer term. It is interesting to note that employee count went from 421 employees in 2006 to 703 employees in 2018. Employee count is not a precise measure but it gives an approximate idea of the level of written premiums and payroll services. One of the most recent filings indicated that the sub still wrote 86.4% of its WC premiums in California. From the spglobal document, during the BRK ownership, there was no capital movement to and from the parent. Also, it appears that the sub maintained autonomy over the investment management of the float and this possibility is supported by the profile of invested admitted assets which had a very high allocation to bonds.
So, indeed not a great return and an elegant way to get rid of a poor reputational risk to return subsidiary.

villainx

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Re: Buffett/Berkshire - general news
« Reply #1333 on: September 10, 2019, 12:10:10 PM »
I didn't see this shared, and there's a pay or sign up wall, but there was an article about real estate brokers on the economist recently: https://www.economist.com/united-states/2019/08/29/why-americas-real-estate-brokers-are-such-a-rip-off.

Berkshire has a big real estate brokerage subsidiary, right?  I don't sense real threat to status quo (or direct mention of Berkshire), mainly stating the problems.  But it's interesting to think about Berkshire expansion in that area (as well as Brookfield's exit?).

Munger_Disciple

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Re: Buffett/Berkshire - general news
« Reply #1334 on: September 10, 2019, 01:01:48 PM »

Looking at various regulatory filings, it remains hard to get a clear picture but it appears that the acquisition was underwhelming. Underwriting results varied ++ from year to year and the lumpiness was not accompanied by very significant growth over the longer term. It is interesting to note that employee count went from 421 employees in 2006 to 703 employees in 2018. Employee count is not a precise measure but it gives an approximate idea of the level of written premiums and payroll services. One of the most recent filings indicated that the sub still wrote 86.4% of its WC premiums in California. From the spglobal document, during the BRK ownership, there was no capital movement to and from the parent. Also, it appears that the sub maintained autonomy over the investment management of the float and this possibility is supported by the profile of invested admitted assets which had a very high allocation to bonds.
So, indeed not a great return and an elegant way to get rid of a poor reputational risk to return subsidiary.

Good post. Given there were no distributions, it was a very sub-par return.

CassiusKing1

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Re: Buffett/Berkshire - general news
« Reply #1335 on: September 18, 2019, 01:25:28 PM »

WneverLOSE

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Re: Buffett/Berkshire - general news
« Reply #1336 on: September 18, 2019, 01:42:37 PM »
Tracy Britt Cool leaving Berkshire to start her own firm.

https://www.cnbc.com/2019/09/18/berkshire-executive-and-buffett-protege-tracy-britt-cool-is-leaving.html

Interesting to me is that out of the thousands of investment professionals that would kill to be in her position Buffett chose her out of school at the age of 25 (my current age  8))

Interview with her from 2018 : https://www.youtube.com/watch?v=paRdfLmQNA8

One day this forum will have to be called Corner of Berkshire, Fairfax, Boston-Omaha & Tracy Co. with all the new mini Berkshires around

John Hjorth

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Re: Buffett/Berkshire - general news
« Reply #1337 on: September 18, 2019, 02:00:11 PM »
It reads to me like something smaller than the Swedish public listed Investor AB as a part of the whole Wallenberg sphere [market value right now at SEK ~361 B], but still active management, or perhaps like the Danish Schouw & Co A/S [just to keep it minor] :

Quote
“I want to build a long-term platform and a long-term vehicle to acquire and build businesses,” Cool said in an interview with the WSJ. “There are companies that I think there’s a lot of value in helping them get to the next level, but they’re too small for Berkshire.”

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Jurgis

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Re: Buffett/Berkshire - general news
« Reply #1338 on: September 18, 2019, 02:12:58 PM »
One day this forum will have to be called Corner of Berkshire, Fairfax, Boston-Omaha & Tracy Co. with all the new mini Berkshires around

More likely it will be called Corner of Berkshire Past.

Fairfax has not done well.
Berkshire after Buffett ... ???
Boston-Omaha is not something special and likely won't be.
Tracy Co. - we'll see.
"Before you can be rich, you must be poor." - Nef Anyo
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John Hjorth

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Re: Buffett/Berkshire - general news
« Reply #1339 on: September 18, 2019, 03:07:02 PM »
One day this forum will have to be called Corner of Berkshire, Fairfax, Boston-Omaha & Tracy Co. with all the new mini Berkshires around

More likely it will be called Corner of Berkshire Past.

Fairfax has not done well.
Berkshire after Buffett ... ???
Boston-Omaha is not something special and likely won't be.
Tracy Co. - we'll see.

A great mix of skeptisism for the future, rear mirror view on future outcomes [- at least to me -], and no trust or belief in the [very competent!] persons [perhaps, perhaps not!] younger than you . ... -Very much like me! [ : - ) ]
”In the race of excellence … there is no finish line.”
-HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the United Arab Emirates and Ruler of Dubai