Fairfax Financial Shareholder's India Trip

[Luckyone77]

Great job, Parsad! I feel like I just went to India.

[investmd]

Parsad,
as a conclusion to this thread, could you please summarize a few key points you now know about FFH future that you didn't appreciate before the trip.

FFH returns have been flat for past 4 years. During the 10 year bull market FFH has not quite achieved 2x (Price in Feb 2009 was approx C$350 vs. $640 today). Returns not terrible, but expectation of Prem, the insurance business, equity and bond allocation were higher.  After this trip are you more convinced than ever that long term FFH investors are in good hands and that the future is likely brighter than the past?
Thanks,

[LC]

Sanjeev, those photos look incredible. Those hotels look awesome. I wish I had seen this earlier - we have a team in Mumbai and I may have been able to justify a trip. Perhaps next year.

[Parsad]

Parsad,
as a conclusion to this thread, could you please summarize a few key points you now know about FFH future that you didn't appreciate before the trip.

FFH returns have been flat for past 4 years. During the 10 year bull market FFH has not quite achieved 2x (Price in Feb 2009 was approx C$350 vs. $640 today). Returns not terrible, but expectation of Prem, the insurance business, equity and bond allocation were higher.  After this trip are you more convinced than ever that long term FFH investors are in good hands and that the future is likely brighter than the past?
Thanks,

Hi Investmd,

I think the one conclusion you can draw about Fairfax, say compared to Berkshire, Markel, etc is that the talent pool at Fairfax is very deep.  You have layer of quality manager upon layer, so succession is not an issue at Fairfax unlike Berkshire and Markel.  Fairfax's investment and operations teams are huge!  While the decisions are made at the top with the core group of managers at Hamblin-Watsa, you have managers below them that are very capable and have the expertise in regional markets. 

I also don't think you are going to get the huge swings we used to see earlier in Fairfax or Berkshire, where Prem or Buffett would make that one big acquisition/investment over and over.  I see Fairfax now as a vehicle that will take the occasional big swing, but a lot of smaller swings in succession that will create returns and value over time.  So imagine a less volatile Fairfax, and probably very diverse in terms of regional investments and insurance operations.  That era of huge bets by Prem or Brian Bradstreet is coming to an end.  It will be many smaller decisions that will move the needle in the future and a globally diversified entity...much earlier than Berkshire.  Cheers!