This man paid $650,000 to learn one idea from Warren Buffett.

That idea helped Monish Pabrai turn $1M into $600,000,000+

His “Dhandho” investing philosophy is so shockingly simple anyone can do it.

Here are 8 of his best investing rules: 🧵
(No. 6 is mind-blowing)
June 25, 2008.

Monish Pabrai sat across from Warren Buffett at a steakhouse in Omaha.

He had just paid $650,000 for this lunch.

No agenda. No notebook. Just one question on his mind:

“What mental model built Berkshire Hathaway?”…

The most dangerous investor in the world.

Carl Icahn made a 25.3% annual return over 40 years

He turned $8,000 into a $7.4 billion fortune by transforming dying companies into billion-dollar companies...

Here are 8 of his best investing rules:
(No. 6 is fascinating) Carl Icahn was born in 1936 in Queens.

His dad was a frustrated cantor who became a teacher.

His mom pushed him toward med school to survive in what she called a dangerous world.

But he had other plans...

Jim Simons was the greatest investor of all time.

He turned $1000 in 1988 into $4B in 30 years.

His hedge fund achieved 66% returns annually by hiring mathematicians and physicists instead of Wall Street experts.

Here's how a mathematician became the world's best investor: 🧵
As a kid in the 1940s, Jim loved numbers.

At just 4 years old, he discovered Zeno's Paradox in his dad's car:

"You could always use half of what gas remains, then half of that, so you'd never run out."

But his mind would soon take him somewhere far more complex...

I just returned from Warren Buffett's 60th Berkshire meeting.

Buffet revealed shocking truths about Japan, AI, and the future of Berkshire's $335B cash pile.

People are calling it one of the best meetings EVER.

Here's what happened (gets crazier as you read): 🧵 This was Buffett's 60th annual meeting and broke all attendance records.

19,700 people showed up just for the shopping day. See's Candy did $317,000 in sales, Brooks did $310,000, and Jazwares doubled their record.

Even at 94, Buffett still commands a room like no one else...

This billionaire predicted the 2008 crash when no one believed him.

Now, Ray Dalio is warning that America faces an economic disaster that's worse than anything in 90 years.

The terrifying part? It's already beginning to unfold.

Here's what he says is coming next: 🧵 Ray Dalio built a $125 billion hedge fund.

He predicted the 2008 crash before anyone else.

After studying 500 years of economic cycles, he spotted a pattern that precedes every major collapse.

This pattern just appeared for the first time since 1930...

The world's most feared investor.

Paul Singer hasn't had a down year since 1977.

His fund returned 14% annually for 46 years, going from managing $1.3 million to $72 billion through activist investing...

Here are 8 of his best investing rules:
(No. 6 is fascinating) 1/ Protect your capital at all costs.

Singer lost 88% of his mother's $50,000 savings in the 1974 bear market.

This is where his #1 principle came from.

"When big losses happen, people lose their minds and judgment."

Always protect the downside first.

The most powerful force in investing isn’t timing, diversification, or analysis.

It’s patience.

Chris Mayer studied every 100x stock since 1962, and found most people had already owned one… but sold.

Here's a 12-part checklist for finding (and keeping) 100-baggers: 1/ The most important rule from analyzing 365 companies that returned 100X:

Buy right, then hold on much longer than feels comfortable.

Most investors sell winners way too early, missing 80-90% of potential gains.

Time is your only real edge in the market.

This man broke every investing rule.

He bought 1,400 different stocks when experts like Buffett, Munger, and Graham said to focus on 20.

Then he crushed the market by 29% yearly for 13 years straight.

Here's how Peter Lynch's "bucket system" changed investing forever:🧵 1,400 stocks at once.

That's not a typo.

Lynch built from 60 to 1,400 stocks from 1977 to 1990, buying dozens in the same industry.

Wall Street thought he had lost his mind. But he discovered something that would make him a legend...

Dev Kantesaria from Valley Forge Capital has grown its Assets from 300k USD in 2007 to 4 Billion.

With a concentrated portfolio, he achieved a 15% CAGR.

Here are the 5 major lessons
⬇️ First about Dev:
🟠Dream to become a surgeon
🟠Starts med school but quit in his 3rd year
🟠On to Mckinsey as a consultant for 2 years
🟠Worked in venture capital: biotech for 18 years
🟠Starts a hedge fund in public equities, mainly long

I mostly used multiples, instead of yields when investing. Didn't see the benefits

Until Buffett showed me the way through farming and inversion.

Here's a 9-step yield analysis applied to $DNP, $INMD, $ADYEY, $DUR and $BABA

Which will reign supreme? Let's first look at 6 yields from the past and go through them 1 by 1.

Then we'll look at yields for the future.

Warren Buffett has beaten the market without using Excel

In his mind, he uses the Quality to Value ratio

I've included it in my investing process

Here's what I've come up with
🧵👇 Here's the gist of it:

🟥Measure the Quality of a company
🟠What is the Valuation of the company?
🟨Q/V gives us the quality of the investment
🟢Rank the companies based on Q/V and other criteria
🟦Only add companies to a portfolio that strengthens the portfolio Q/V value

Most investors do not beat the market over the long term.

Polen Capital has with a net 14% yearly return over 35 years and 66 Billion USD under management

Their secret?

Keep it crayon simple

Here’s their radically elegant approach in 6 steps 1. David Polen founded Polen Capital in 1979 and was a broker during Black Monday (1987)

He devised a strategy that could endure and sit out a crisis.

He created the Focused Growth fund, now led by Dan Davidowitz

➡️Fish for the biggest and best fish in the waters

Dino Polska ($DNP.WA) has grown at a 30% sales CAGR over the last decade.📈

Price has followed: It's a 10-bagger since the IPO

Is this a good time to take a position?
👇🧵 1. Performance

🟠Margins have declined a little
🟠Sales growth has slowed versus 2022 (only 30%)
🟠But 2022 was an unusual year, with inflation spiking

Performance seems solid

633 Billion USD can be unlocked by 'simply' optimizing working capital.

I must admit, as an investor, I wasn't aware of this.

Until I read the 2023 report by JP Morgan on the cash conversion cycle!

Here's what you need to know (applied to Dino Polska $DNP.WA)
👇🧵 1. What is the cash conversion cycle (CCC)?

➡️The number of days it takes for a company to convert its inventory into cash
➡️How long each dollar spent is tied up before it is converted into cash again
➡️A measure of the efficiency of the company

I've been investing for a decade now.

All this time, I was struggling with discounted cash flow models and intrinsic valuation.

Then I spent the past months reading Mauboussin's writings.

Here are several key insights that I learned
👇🧵 1. In valuation, it's not about the model.

It's about making assumptions explicit.

P/E multiples or relative valuations are shortcuts, rules of thumb.

Making your hypothesis explicit is the first step in building a sound valuation of a company.

Paul Andreola (@PaulAndreola ) nailed a 100-bagger ($XPEL) by using a very focused investment strategy.

He runs a newsletter called small cap discoveries.

Here's what we can learn from his investment process in 13 easy steps:
👇 1. Focus: Go deep instead of wide
Paul focuses on Canadian small and micro-caps. By excluding commodities and focusing on revenue and earnings growth, his investable universe becomes small but focused. This allows him to get a deeper knowledge of his universe.

Kaspi ($KSPI) has grown earnings per share at a 40% CAGR over the last 5 years.

It trades at a PE of under 12!

Will Kaspi become the WeChat of Central Asia?

Find out in our latest Destination Analysis (full article in bio with 34-page pdf download)
Here’s a 9-part glimpse
👇 1. Kaspi KZ is the super app of Kazakhstan. It has 3 business segments:
🟠 Payments (think Paypal)
🟠 Marketplace (think eBay)
🟠 Fintech (banking)
All in 1 app, with payments and marketplace rapidly rising:

Return On Equity (ROE) is a simple and powerful metric.

But I underestimated its flaws.

Here are 10 things to consider to avoid falling into the same trap.
We use Dino Polska as an example. $DNP
👇 1/10 ROE = NET INCOME / AVERAGE EQUITY BOOK VALUE

For Dino Polska, this calculates to 31%, best in class, right? Or not?

Is Inmode a multi-bagger or a value trap? $INMD

We cover its business, capital allocation, MOAT, competition, and the current conflict in Israel.

Discover our 30-page deep dive in bio.

Here's a 5-point overview for those who cannot wait to dig in:
👇 1. They make money by selling aesthetic medical platforms and handpieces to physicians. Manufacturing is outsourced. Here's an overview of the number of platforms installed worldwide:

It's no secret that measuring a company's 𝗠𝗢𝗔𝗧 can be 𝘁𝗿𝗶𝗰𝗸𝘆.

But Warren Buffet, Pat Dorsey, and Michael Mauboussin showed us the way.

A thread: 𝗙𝗮𝗻𝘁𝗮𝘀𝘁𝗶𝗰 𝗠𝗢𝗔𝗧𝗦 and how to find them in 9 easy steps.
👇 First, some wisdom from Warren Buffet at the 1995 shareholders meeting

"What we're trying to do, is we're trying to find a business with a wide and long-lasting moat around it, protecting a terrific economic castle with an honest lord in charge of the castle."

The P/E ratio is the most widely used parameter in investing.

It turns out, 𝗜 𝗵𝗮𝗱 𝗻𝗼 𝗰𝗹𝘂𝗲 what it 𝗿𝗲𝗮𝗹𝗹𝘆 meant.

Here are 11 takeaways from applying Musk's 𝗳𝗶𝗿𝘀𝘁 𝗽𝗿𝗶𝗻𝗰𝗶𝗽𝗹𝗲𝘀 𝘁𝗵𝗶𝗻𝗸𝗶𝗻𝗴 to uncover the mysteries of the P/E-ratio.
👇 1. The P/E ratio is a shortcut to the valuation process.

P/E = Price per share / Earnings per share

Value is the present value of discounted cash flows.

Price does not equal value

This is the most important thing to remember. You can stop here. Wait, no, please continue 😉