Cheating Is My Hobby
The job of every good generalist is to be constantly looking for new stock ideas. This is an important part of investing that is almost never taught. If you are not constantly searching, your ideas will come passively from Wall Street, the media (oh my god not Jim Cramer), or the “Twitter World”.
One of the best methods to find new stock ideas is:
Find a stock you really like
Use a service like Guru Focus, or WhaleWisdom, to find the large holders of your favorite stock
Look at the list of what this “big holder” also owns
Push yourself to find something interesting on that list, do a quick “one-hour analysis” on this new stock idea to determine if it has any merit
rinse and repeat frequently, this is not a once a quarter task, this is a once a week task
wake up every morning with the idea - “what new company will I look at today” - push yourself, this is not easy
NEVER EVER BUY A STOCK JUST BECAUSE A FAMOUS INVESTOR OWNS IT.
Use this method to find new things to think about, but not as a shortcut.
Plagiarism is not “cheating” in the investment business, it is an important step in the investment process.
Below is a list of portfolios I look at constantly. Some are mutual funds with a ticker, so I use Morningstar, some are hedge funds so I use WhaleWisdom, and some are famous investors with multiple funds, where I use Guru Focus.
The list shows first which stocks in my top 20 each investor owns, and then after the / mark, which of their ideas I want to look at next:
First Eagle Small Cap Opportunity Fund - FESCX - Ingredion / Ashland???
Select Equity Group - Whale - Revvity, Middleby, Neogen 6% / Tempur Sealy, Core & Main???
Barrow Hanley - Guru - Smith Nephew / Jacobs, Air Products???
Diamond Hill - DHMIX - Red Rock 7% / Ashland, Perrigo, Rayonier???
Ron Baron - Guru - Red Rock 17%, Chart 3%, Neogen / Krispy Kreme, FIGS???
Victory Sycamore - VSOIX - Helmerich Payne , Brunswick / Columbia???
Gate City Capital - Whale - none/ Canterbury Park???
Black Creek - Whale - Nutrien / Interpublic, NICE???
T Rowe Price Mid-cap Value - TRMCX - Tyson, Middleby / Baxter, Charles River???
Cove Street - Whale - none / American Vanguard???
Seth Klarman - Guru - none / Willis Tower, Jacobs???
Mason Hawkins - LLPFX - Guru - none /CNH, Mattel???
Don Smith - Guru - none / Mosaic???
Eminence Capital - Whale - Corteva / Ashland, CF Industries, Louisiana Pacific???
Azarias Capital - Whale - Unifi / Scholastic???
Van Eck Morningstar Moat - SNOT - Chart, Brunswick / HF Sinclair???
Royce - RVT - none / Ziff Davis???
First Pacific - Guru - Kinder Morgan / Carmax???
Jana Partners - Whale - Treehouse / Trimble???
Howard Marks - Guru - none / SunOpta???
Bill Ackman - Guru - none / Howard Hughes???
Below are stocks is my top 20, that are not owned by any famous value investors:
Royal Gold - First Eagle does own this in their gold fund
Jack in the Box - restaurants are too scary right now
Titan International - no research coverage, who wants to go to Iowa City
First Cash Financial - it is just easier to own a bank
Northwest Natural - not the most liquid stock