Compilation of Reads, Volume 2
In the first compilation of reads, I shared three articles which I think represent different verticals for analytical thought. Namely, a conceptual hard-to-read piece, a shareholder letter and a profoundly abstract essay. These compose the triad I suspect should yield the highest results, were one to master it.
The approach to the second compilation differs from the aforementioned, but the essence remains the same. Letters and articles included still portray these elements. However, individually, none can be distinguished for maximizing a single one. If I had to guess, perhaps portfolio management is the trait that’s most covered in this compilation. Â
Notwithstanding the prior remark, my intention is to expand the scope of exposure for the reader. Finding the territories that deserve exploration seems implausible if one doesn’t count with a superficial mapping of what’s known. Hereafter, I’ll briefly expand on the reasoning behind the inclusion of each piece.
Francois Rochon 2008 Shareholder Letter
Rochon’s methodology for business selection and portfolio management is systematic and methodical. He was nonetheless capable of finding an intersection between rigidness and flexibility. Rochon has been, throughout the years, very vocal in stating that investing resembles art. Ever after 2005, all of Francois’ letters begin with a work of art Giverny Capital possesses.
Particularly, the 2008 annual report highlights the attitude a great investor had when the world was crumbling. It’s fundamental to note that courage is a trait I noticed many outperformers have. Not blind, however. It’s derived from knowledge and understanding. Emulating courage turns very rapidly into recklessness if the premises under which one is operating are not sound.
Terry Smith 2021 Shareholder Letter
Great investors are generally great teachers as well. Terry Smith is the person whom I think has best articulated how a strategy for equity investing could look like. Furthermore, his 2021 letter shines among them all due to the number of brilliant insights included. This might be the single piece that has helped me advance the farthest in business analysis.
Jeff Bezos 1997 Shareholder Letter
Bezos’ letters contain thoughtful advice for business managers. At the end of every issue, he used to attach the 1997 letter. In the latter, Jeff went over his philosophy in an attempt to attract shareholders aligned with it and warn those against it. My sense is that this letter best represents Bezos’ core values as well as the areas wherein Amazon would thereafter focus. It’s articulated the basis for later success.
Nick Sleep mid-2009 Letter
Nicholas Sleep is the most brilliant investor I’ve read, and I suspect you’ll get a taste of this with the selected letter. Nick taught me a fundamental element I had been missing for investing: we can compete in the market with intellectual theses. There are patterns that repeat themselves among successful businesses. Nick noticed that ‘Scale Economies Shared’ had produced immense benefits to the practitioners and their respective shareholders. As a final note, coupling this with Bezos letter might help better grasp where the concept comes from.Â
RV Capital, 15-year Anniversary Letter
Plenty of meditations have flooded the investing field, as happens wherever humans gather experience and observations. Yet the incremental value that’s generated by ‘new’ reflections tends to decline after a certain point. It therefore becomes crucial to detect which of these new meditations might cause intellectual breakthroughs for oneself. I suspect Robert Vinall’s letter falls in this category.
The Whistle
I read Benjamin Franklin’s autobiography in February and was struck by how little joy I found in his book. However, the sample I acquired included Franklin’s other writings as well, ranging from essays to letters. In these is where I strongly recognized the brilliance of Benjamin.
For the first compilation, I selected The Way to Wealth, in which Franklin expresses how industry, frugality and hard work lead to a wealthy life. The Whistle narrates an anecdote concerning Benjamin’s childhood, and the impact it had on the rest of his life. The thesis for this writing goes over Man’s misunderstanding of the value of things and the misery this brings upon.
Extract from the conclusion of The Origin of Species
The Origin of Species is a fascinating and wide endeavor. It explores all intricacies regarding Natural Selection. One of Darwin’s traits that caught me by surprise was his humility. On numerous occasions, he states the ignorance surrounding his findings and ideas. Further, he explicitly manifests the pushback he received from peers. Everyone believed in the independent creation of species.
What’s remarkable about Charles and why I selected this specific extract is because it shows the power in finding comfort in solitude. Consensus is not the truth. The Origin of Species might be the piece that has had the largest scientific impact in history. It vividly entails that extraordinary returns are rooted in rational contrarianism.
Personal Commentary
I sincerely hope you find the compilation useful.
Contact: Giulianomana@0to1stockmarket.com