The Last Straw

Happy New Year Investor! We hope you managed some well-deserved time off in recent weeks, both from your usual vocation as well as with your investing. Not that we’re advocating for complacency, but it’s often useful to take a step back every now and then. Partly because it’s important to have some time for a broader reflection on your investment goals, […]

When a share price underperforms the market, how much of that can be blamed on management? Conversely, when prices surge higher, how much credit do the senior execs deserve? Of course, in the short run, the answer is probably ‘not much’. But even over a period of a year or two it can be hard to connect executive decisions to […]

This week we lost one of the greats. Only one month shy of his 100th birthday, legendary investor and polymath Charles Thomas Munger departed this mortal coil. He had a rich and varied life with pursuits spanning law, mathematics, architecture — and much more besides. He witnessed first hand incredible societal and technological change and, of course, amassed a giant […]

If you could fold a piece of paper just 42 times, it’d be thick enough to touch the moon. Fold it 52 times further and it’d reach across the entire observable universe.  Exponentials break your brain, and thinking in those terms doesn’t come naturally. Still, most investors tend to get it, at least as it applies to compound returns. But there are […]

Accounting may not be the most enthralling of topics, but some basic literacy here is vital if you fancy yourself a stock picker. As Buffett put it: “You have to understand accounting and you have to understand the nuances of accounting. It’s the language of business and it’s an imperfect language, but unless you are willing to put in the […]

There is no one ‘right’ way to invest. Even if there were, somehow, a way to prove the superiority of a particular approach, it’s not worth much if you lack the wherewithal to execute it. And it’s not necessarily a question of ability; temperament, time, experience, resources, personal interest, and many other things besides, are also important. The best investing […]

Charlie Munger has loads of great quotes, but this one is a standout: The first rule of compounding: never interrupt it unnecessarily Charlie Munger The maths behind compounding is easy enough, but the intuition is anything but. If you can find an investment that compounds at 20% per annum, the gain you make in year 10 is greater than the total […]

At bottom the ability to buy securities – particularly common stocks – successfully is the ability to look ahead accurately. Looking backward, however carefully, will not suffice, and may do more harm than good.” — Benjamin Graham The financial statements can tell you a great deal about a company, and any serious investor ignores them at their own peril. Revenue, margins, […]

We love our small caps here at Strawman. And not without good reason. The trouble is, at least according to conventional wisdom, that things are far riskier in that space. Perhaps that’s true, to some extent, if by risk you mean volatility. And it’s not an unfair characterisation if you assume, as many do, that “small cap” must mean pre-revenue, […]

In a fair and just world, the only way to build wealth is to generate value for others. If you can enhance the subjective well-being of someone — either through your direct labour or by producing a good they desire — you can demand payment. Either in kind, or more likely money; that wonderful, civilisation-unlocking technology that has allowed human cooperation and coordination […]