I read a couple of newsletters on a monthly / quarterly basis to get new investment ideas and to learn more about the thought processes behind some of the best in the industry.
My favourite is Value Investor Insight (“VII”), which is co-founded by Whitney Tilson of Kase Capital. The VII format interviews several fund managers in the value and growth investing circles on a monthly basis, where the interviewees share their history, investment philosophy, processes and the thesis behind a few current ideas they are vested in. The newsletter is usually less than 20 pages long and the drawback to VII is that it is a paid service. However, considering the value I extracted from it, the price of the newsletter has been paid many times over. It was from VII’s Sep 2013 issue which interviewed Jim Larkins of Wasatch Advisors that I found Ebix as an idea that turned out to be a really good investment. Sapiens was another which I found in VII and invested in. The idea was pitched by Ori Eyal in the Aug 2016 edition.
Another newsletter I read is ROE Reporter by noted Canadian investor, Jason Donville. It is published free on a quarterly basis and he covers his thoughts and the stocks within his portfolio. I first came across the newsletter in February 2016 and more recently, read an interview with Donville in the wonderful book that profiled Canadian investors – Market Masters – by Robin R. Speziale. Donville’s philosophy is that ROE is probably the single best indicator of whether a company is going to be a great compounder. In the newsletter, he ranks listed Canadian companies by highest ROE and lowest P/E ratios in his list of shortlisted opportunities which somewhat reminds me of Joel Greenblatt’s much talked about Magic Formula. Although the newsletter is usually just a couple of pages, I enjoy reading them and am going through the past ones currently. In the last one year, his fund has taken a drubbing from his stock picks such as Concordia (the smaller version of Valeant) and Home Capital Group. Both have high ROEs and are highly leveraged (Home Capital Group’s business is in mortgages) but each have their own set of unique problems that contributed to their downfall. The underlying lesson for me is that while debt may not be the single factor that kills you, it is what will fuel the flames to spread across the rest of your business if any part of the business blows up. That said, Donville’s long term track record remains good and I am sure he will bounce back from this. It was from ROE Reporter that I found an investment opportunity – CRH Medical Corporation, a Canadian company in the gastrointestinal part of the healthcare industry, more specifically in the treatment of hemorrhoids and provides anesthesia services.
The other free newsletter I read on a quarterly basis is the excellent Graham & Doddsville newsletter, an investment newsletter from the Columbia’s Student Investment Management Association (Columbia Business School). The name of the newsletter is of course a play on the term used by Warren Buffett who wrote the seminal letter in 1984 called ‘The Superinvestors of Graham-and-Doddsville’. In each issue, the newsletter profiles investors, a number of whom are alumni of the mecca and school of the original value investors – Columbia Business School, following which the newsletter sometimes include stock pitches by current students. It is a great read each and every time and at about 50 pages for each issue, holds plenty of wisdom and investing nuggets for readers.
I hope you will enjoy reading the above mentioned newsletter as much as I have. If there are any great ones, do feel free to share!