Recently, we’ve increased our positions in a few key holdings including CIBC, Genworth Mortgage Insurance and Blackberry. Initially the returns were positive, lately, based on the news cycle or lack thereof, their values have decreased somewhat. Nothing materially has changed for either one of these holdings, including Blackberry, which made an unexpected profit even when you back out the Qualcomm payment.
Analysts are paid to overreact, we do not. These businesses are sound, make money, and will make more money.
Our Criteria for investing is simple:
- Good or Service is Vital (Need)
- High Barriers to entry (Financial moat)
- Good Management
- Strong Balance Sheet and Cash position
The true mark of an investor versus a trader is how long they can sit still when things are not going in their favour at the moment. If you panic and “limit your losses” you are a trader, if you believe in your analysis and see these swings as temporary, then you are an investor. Limiting your losses also means wiping out future returns.
Stay Calm and Carry on.