Tag Archives: Simoleon Sense

Simoleon Sense: Investing & Scuttlebutt Research

Creative Accounting

Conversation with Paul Lountzis: Investing & Scuttlebutt Research. Keep checking www.simoleonsense.com to improve and learn.

I’m happy to share with you a conversation I had with my friend Paul Lountzis of Lountzis Asset Management. Over the years I’ve learned a lot about the art of scuttlebutt research from Paul. I asked him if he would share his insights with us, Paul agreed, and the rest as they say is history. Please leave your comments below the post and I’ll ask Paul to answer any questions or thoughts.

 Guest Bio:

Prior to forming Lountzis Asset Management, LLC, Mr. Lountzis was employed by Ruane, Cunniff & Company, Inc., New York, NY, a registered investment adviser managing the Sequoia Mutual Fund as well as private accounts, from 1990 through 1999 as an analyst, and as a partner from 1995 through 1999.

Mr. Lountzis was an analyst at Royce & Associates, Inc., New York, NY from 1989 through 1990 where he evaluated small and mid-cap stocks for purchase in institutional accounts as well as various mutual funds including the Pennsylvania Mutual Fund.

 Part 1: How Paul Became An Investor (click here for a direct link to the interview)

In part 1 Paul covers:

  • Learning about Warren Buffett.
  • Getting a job as a consultant, learning about competitive analysis ,& developing interviewing skills.
  • Getting a job at Royce & Associates and discovering small cap stocks.
  • Getting a job at Ruane, Cunniff, & Goldfarb.

Part 2: An Overview of Paul’s Scuttlebutt Process  (click here for a direct link to the interview)

 In part 2 Paul covers:

  • Researching Freddie Mac and using proprietary research to make a contrarian call.
  • Researching Progressive-talking with seasoned agents led to uncovering tipping points.

Part 3: Using Interviews While Researching Investment Opportunities (click here for a direct link to the interview)

In part 3 Paul covers:

  • Studying companies and industries.
  • The importance of curiosity & preparation in crafting questions.
  • Types of questions to ask during interviews.
  • Picking people to interview.
  • The importance of uncovering differential insights.
  • Learning about outdoor advertising and applying scuttlebutt to learn about the best companies in the space.
  • Learning about Nike by talking with seasoned distributors.
  • The importance of building long-term relationships with industry participants.

Part 4: Investment Mistakes & Sins of Omission (click here for a direct link to the interview)

In part 4 Paul covers:

  • Mistakes of Omission.
  • His extensive research of the HMO industry and missing an investment.
  • The increasing importance of qualitative research as financial markets become more competitive.

 I can’t wait to find the time to view the video interviews. Let me know what you think.

Tap Dancing to Work (Buffett)

Catch up on articles you may have missed on Buffett over the years. Go to www.fortune.com/buffettbook

For example, “Can you beat the market?” http://management.fortune.cnn.com/2012/11/21/buffett-beat-stock-market/


A Course on Mental Models–Helping Us All to Decide and Think Better

Perfect solutions of our difficulties are not to be looked for in an imperfect world.–Winston Churchill

Model Thinking

If you haven’t signed up, then here is another chance. I signed up; I need all the help possible.

Hi Everyone,

Good News!!! The course ‘Model Thinking’ will go live very shortly. When it does go live, we’ll be asking you to officially register and agree to some standard terms and conditions. In the interim, you can now go to the site, at http://www.coursera.org/modelthinking/lecture/preview and watch the first two sets of lectures. The first set of lectures covers the benefits of modeling and provides a framework for the course. The second set covers Thomas Schelling’s seminar model of segregation as well as a model of standing ovations that I developed with John Miller of Carnegie Mellon University.

The full site with quizzes, discussion forums, and all the other bells and whistles will be operational very shortly. I thank you all for your patience. Enjoy the first few lectures!!

As we say in Ann Arbor… Go Blue!!!


Interesting Free Investing Newsletters and Links

Just in case you missed these:

Ask for a free quarterly newsletter by emailing: Hewitt.Heiserman@EarningsPower.com,

Ask to be on his email list: kessler@robotti.com,

and his weekly emailings:sfriedman@gmail.com  There will be overlap, but you will find interesting articles, videos and value investors. Read ruthlessly, however, I don’t bother to read about Fairholme’s investment in BAC or AIG, because those companies are out of my circle of competence. Only read what benefits YOU.

Recommended blogs:

big picture blog: http://www.ritholtz.com/blog/