莫尼斯•帕波莱访谈
2009-05-04 22:48阅读：
非常佩服莫尼斯·帕波莱的学习和领悟能力，巴菲特的投资哲学，于其投资风格上表达得极其完整，学习价值投资，这个人是非要彻底研究不可的。
Here is an interview with the man who just paid $650,000 for lunch
with Warren Buffett.
It was sent to me by the
interviewer and can be found at Investorguide.com
July 11, 2007
Interview conducted by Tom Murcko.
It is my privilege to bring you the following interview I recently
conducted with value investing superstar Mohnish Pabrai. Mohnish is
one of my favorite investors who doesn't have the initials W.B. His
investment style is similar to the low risk, high value style
followed by Warren Buffett and myself, and has led his portfolios
to perform marvelously since the 1990s.
How successful have his techniques been? I'll let the numbers speak
for themselves: A $100,000 investment in Pabrai Funds at inception
(on
July 1, 1999) was worth $722,200 on March 31, 2007. That works out
to an annualized return of 29.1%, and is after all fees and
expenses. Assets under management are over $500 million, up from $1
million at inception. Although a person probably can't get into the
investing hall of fame with eight years of outperformance (even if
they crush the indices), Pabrai is already mentioned in most
articles about the search for the next Warren Buffett, and
justifiably so.
Equally important, he genuinely wants to help others become better
investors, and in that spirit has just published his second book,
The Dhandho Investor. The book is both illuminating and easy to
read, and it deserves to be on every investor's bookshelf next to
Benjamin Graham's The Intelligent Investor.
I felt extremely fortunate when he recently agreed to answer some
questions about his investment strategy in this exclusive
interview, conducted by email. I hope you find it useful, and that
it inspires you to pick up a copy of his book if you haven't
already.
Happy Investing,
Tom Murcko
CEO, InvestorGuide.com
InvestorGuide: You have compared Pabrai Funds to the original
Buffett parternships, and there are obvious similarities: investing
only in companies within your circle of competence that have solid
management and a competitive moat; knowing the intrinsic value now
and having a confident estimate of it over the next few years, and
being confident that both of these numbers are at least double the
current price; and placing a very small number of very large bets
where there is minimal downside risk. Are there any ways in which
your approach differs from that of the early Buffett partnerships
(or Benjamin Graham's approach), either because you have found ways
to improve upon that strategy or because the investing world has
changed since then?
Mohnish Pabrai: The similarity between Pabrai Funds and the Buffett
Partnerships that I refer to is related to the structure of the
partnerships. I copied Mr. Buffett's structure as much as I could
since it made so much sense. The fact that it created a very
enduring and deep moat wasn't bad either. These structural
similarities are the fees (no management fees and 1/4 of the
returns over 6% annually with high water marks), the investor base
(initially mostly close friends and virtually no institutional
participation), minimal discussion of portfolio holdings, annual
redemptions and the promotion of looking at long term results etc.
Of course, there is similarity in investment style, but as Charlie
Munger says, 'All intelligent investing is value investing.'
My thoughts on this front are covered in more detail in Chapter 14
of The Dhandho Investor.
Regarding the investment style, Mr. Buffett is forced today to
mostly be a buy and hold forever investor today due to size and
corporate structure. Buying at 50 cents and selling at a dollar is
likely to generate better returns than buy and hold forever. I
believe both Mr. Munger and he would follow this modus operandi if
they were working with a much smaller pool of capital. In his
personal portfolio, even today, Mr. Buffett is not a buy and hold
forever investor.
In the early days Mr. Buffett (and Benjamin Graham) focused on
buying a fair business at a cheap price. Later, with Mr. Munger's
influence, he changed to buying good businesses at a fair price. At
Pabrai Funds, the ideal scenario is to buy a good business at a
cheap price. That's very hard to always do. If we can't find enough
of those, we go to buying fair businesses at cheap prices. So it
has more similarity to the Buffett of the 1960s than the Buffett of
1990s. BTW, even the present day Buffett buys fair businesses at
cheap prices for his personal portfolio.
Value investing is pretty straight-forward - you try to get $1
worth of assets for much less than $1. There is no way to improve
on that basic truth. It's timeless.
InvestorGuide: Another possible difference between your style and
Buffett's relates to the importance of moats. Your book does
emphasize investing in companies that have strategic advantages
which will enable them to achieve long-term profitability in the
face of competition. But are moats less important if you're only
expecting to hold a position for a couple years? Can you see the
future clearly enough that you can identify a company whose moat
may be under attack in 5 or 10 years, but be confident that that
'Mr. Market' will not perceive that threat within the next few
years? And how much do moats matter when you're investing in
special situations? Would you pass on a special situation if it met
all the other criteria on your checklist but didn't have a
moat?
Pabrai: Moats are critically important. They are usually critical
to the ability to generate future cash flows. Even if one invests
with a time horizon of 2-3 years, the moat is quite important. The
value of the business after 2-3 years is a function of the future
cash it is expected to generate beyond that point. All I'm trying
to do is buy a business for 1/2 (or less) than its intrinsic value
2-3 years out. In some cases intrinsic value grows dramatically
over time. That's ideal. But even if intrinsic value does not
change much over time, if you buy at 50 cents and sell at 90 cents
in 2-3 years, the return on invested capital is very
acceptable.
If you're buying and holding forever, you need very durable moats
(American Express , Coca Cola , Washington Post etc. . In that case
you must have increasing intrinsic values over time. Regardless of
your initial intrinsic value discount, eventually your return will
mirror the annualized increase/decrease in intrinsic value.
At Pabrai Funds, I've focused on 50+% discounts to intrinsic value.
If I can get this in an American Express type business, that is
ideal and amazing. But even if I invest in businesses where the
moat is not as durable (Tesoro Petroleum , Level 3,
Universal Stainless ), the results are very acceptable. The key in
these cases is large discounts to intrinsic value and not to think
of them as buy and hold forever investments.
InvestorGuide: For that part of our readership which isn't able to
invest in Pabrai Funds due to the net worth and minimum investment
requirements, to what extent could they utilize your investing
strategy themselves? Your approach seems feasible for retail
investors, which is why I have been recommending your book to
friends, colleagues, and random people I pass on the street. For
example, your research primarily relies on freely available
information, you aren't meeting with the company's management, and
you don't have a team of analysts crunching numbers. To what extent
do you think that a person with above-average intelligence who is
willing to devote the necessary time would be able to use your
approach to outperform the market long-term?
Pabrai: Investing is a peculiar business. The larger one gets, the
worse one is likely to do. So this is a field where the individual
investor has a huge leg up on the professionals and large
investors. So, not only can The Dhandho Investor approach be
applied by small investors, they are likely to get much better
results from its application than I can get or multi-billion dollar
funds can get. Temperament and passion are the key.
InvestorGuide: You founded, ran, and sold a very successful
business prior to starting Pabrai Funds. Has that experience
contributed to your investment success? Since that company was in
the tech sector but you rarely buy tech stocks (apparently due to
the rarity of moats in that sector), the benefits you may have
derived seemingly aren't related to an expansion of your circle of
competence. But has learning what it takes to run one specific
business helped you become a better investor in all kinds of
businesses, and if so, how? And have you learned anything as an
investor that would make you a better CEO if you ever decide to
start another company?
Pabrai: Buffett has a quote that goes something like: 'Can you
really explain to a fish what it's like to walk on land? One day on
land is worth a thousand years of talking about it, and one day
running a business has exactly the same kind of value.' And of
course he's said many times that he's a better investor because
he's a businessman and he's a better businessman because he is an
investor. My experience as an entrepreneur has been very
fundamental to being any good at investing.
My dad was a quintessential entrepreneur. Over a 40-year period, he
had started, grown, sold and liquidated a number of diverse
businesses - everything from making a motion picture, setting up a
radio station, manufacturing high end speakers, jewelry
manufacturing, interior design, handyman services, real estate
brokerage, insurance agency, selling magic kits by mail - the list
is endless. The common theme across all his ventures was that they
were all started with virtually no capital. Some got up to over 100
employees. His downfall was that he was very aggressive with growth
plans and the businesses were severely undercapitalized and
over-leveraged.
After my brother and I became teenagers, we served as his de facto
board of directors. I remember many a meeting with him where we'd
try to figure out how to juggle the very tight cash to keep the
business going. And once I was 16, I'd go on sales calls with him
or we'd run the business while he was traveling. I feel like I got
my Harvard MBA even before I finished high school. I did not
realize it then, but the experience of watching these businesses
with a front-row seat during my teen years was extremely
educational. It gave me the confidence to start my first business.
And if I have an ability to get to the essence of a subset of
businesses today, it is because of that experience.
TransTech was an IT Services/System Integration business. We
provided consulting services, but did not develop any products etc.
So it wasn't a tech-heavy business. While having a Computer
Engineering degree and experience was useful, it wasn't critical.
TransTech taught me a lot about business and that experience is
invaluable in running Pabrai Funds. Investing in technology is easy
to pass on because it is a Buffett edict not to invest in rapidly
changing industries. Change is the enemy of the investor.
Being an investor is vastly easier than being a CEO. I've made the
no-brainer decision to take the easy road! I do run a business even
today. There are operating business elements of running a fund that
resemble running a small business. But if I were to go back to
running a business with dozens of employees, I think I'd be better
at it than I was before the investing experience. Both investing
and running a business are two sides of the same coin. They are
joined at the hip and having experience doing both is fundamental
to being a good investor. There are many successful investors who
have never run a business before. My hat's off to them. - For me,
without the business experiences as a teenager and the experience
running TransTech, I think I'd have been a below average investor.
I don't fully understand how they do it.
InvestorGuide: Is your investment strategy the best one for you, or
the best one for many/most/all investors? Who should or shouldn't
consider using your approach, and what does that decision depend on
(time commitment, natural talent, analytical ability, business
savvy, personality, etc)?
Pabrai: As I mentioned earlier, Charlie Munger says all intelligent
investing is value investing. The term value investing is
redundant. There is just one way to invest - buy assets for less
than they are worth and sell them at full price. It is not 'my
approach.' I lifted it from Graham, Munger and Buffett. Beyond
that, one should stick to one's circle competence, read a lot and
be very patient.
InvestorGuide: Some investment strategies stop working as soon as
they become sufficiently popular. Do you think this would happen if
everyone who reads The Dhandho Investor starts following your
strategy? As I've monitored successful value investors I have
noticed the same stocks appearing in their various portfolios
surprisingly often. (As just one example, you beat Buffett to the
convertible bonds of Level 3 Communications back in 2002, which I
don't think was merely a coincidence.) If thousands of people start
following your approach (using the same types of screens to
identify promising candidates and then using the same types of
filters to whittle down the list), might they end up with just
slightly different subsets of the same couple dozen stocks? If so,
that could quickly drive up the prices of those companies
(especially on small caps, which seem to be your sweet spot) and
eliminate the opportunities almost as soon as they arise. Looked at
another way, your portfolio typically has about ten companies,
which presumably you consider the ten best investments; if you
weren't able to invest in those companies, are there another 10 (or
20, or 50) that you like almost as much?
Pabrai: As long as humans vacillate between fear and greed, there
will be mispriced assets. Some will be priced too low and some will
be priced too high. Mr. Buffett has been talking up the virtues of
value investing for 50+ years and it has made very few folks adopt
that approach. So if the #2 guy on the Forbes 400 has openly shared
his secret sauce of how he got there for all these decades and his
approach is still the exception in the industry, I don't believe
I'll have any effect whatsoever.
Take the example of Petrochina. The stock went up some 8% after
Buffett's stake was disclosed. One could have easily bought boat
loads of Petrochina stock at that 8% premium to Buffett's last
known buys. Well, since then Petrochina is up some eight-fold -
excluding some very significant dividends. The entire planet could
have done that trade. Yet very very few did. I read a study a few
years back where some university professor had documented returns
one would have made owning what Buffett did - buying and selling
right after his trades were public knowledge. One would have
trounced the S&P 500 just doing that. I don't know of any
investors who religiously follow that compelling approach.
So, I'm not too concerned about value investing suddenly becoming
hard to practice because there is one more book on a subject where
scores of excellent books have already been written.
InvestorGuide: You have said that investors in Pabrai Funds
shouldn't expect that your future performance will approach your
past performance, and that it's more likely that you'll outperform
the indices by a much smaller margin. Do you say this out of
humility and a desire to underpromise and overdeliver, or is it
based on market conditions (e.g. thinking that stocks in general
are expensive now or that the market is more efficient now and
there are fewer screaming bargains)? To argue the other side, I can
think of at least two factors that might give your investors reason
for optimism rather than pessimism: first, your growing circle of
competence, which presumably is making you a better investor with
each passing year; and second, your growing network of CEOs and
entrepreneurs who can quickly give you firsthand information about
the real state of a specific industry.
Pabrai: Future performance of Pabrai Funds is a function of future
investments. I have no idea what these future investment ideas
would be and thus one has to be cognizant of this reality. It would
be foolhardy to set expectations based on the past. We do need to
set some benchmarks and goals to be measured against. If a fund
beats the Dow, S&P and Nasdaq by a small percentage over the
long-haul they are likely to be in the very top echelons of money
managers. So, while they may appear modest relative to the past,
they are not easy goals for active managers to achieve.
The goals are independent of market conditions today versus the
past. While circle of competence and knowledge does (hopefully)
grow over time, it is hard to quantify that benefit in the context
of our performance goals.
InvestorGuide: Finally, what advice do you have for anyone just
getting started in investing, who dreams of replicating your
performance? What should be on their 'to do' list?
Pabrai: I started with studying Buffett. Then I added Munger,
Templeton, Ruane, Whitman, Cates/Hawkins, Berkowitz etc. Best to
study the philosophy of the various master value investors and
their various specific investments. Then apply that approach with
your own money and investment ideas and go from
there.
