Tuesday, June 26, 2007

Saying hello with Wesco Financial

Although I have been investing for over 10 years now and participating in Silicon Investor site for as long, I finally decided to write my personal investing blog. My goal is as always: discuss possible investments, think aloud and have fun in the meantime. My approach to investing does not require rapid trading or huge number of decisions. However, I do look at quite a few companies when deciding what to buy and what to sell.

I am mostly following the Buffettology and Superstocks investment approach with some personal adjustments towards Value Investing, mostly looking at high ROE stocks selling at a low price with a reasonable moat and somewhat clear future. Some of my choices go into the corners of these criteria: there are stocks that have more moat, but are less cheap; there are ones which are cheap but have very uncertain future. In the end, it's a personal mix, something that every investor have to develop for themselves. Let's explore parts of that mix here.

To finish this introduction, just couple of words about one of my recent buys: WSC - Wesco Financial. The company of Buffett's friend Charles Munger, partially owned by Berkshire. Every year Munger claims that Wesco is worse than Berkshire Hathaway and every year so far Wesco has matched Berkshire's stock movement. Until now. Right now WSC dropped quite a bit diverging from BRK, and I decided to take position in the BRK sister company. As Munger, I am pretty sure that WSC is not as good as BRK, but I still think it may provide outsized investment returns for investors buying it cheap. Is it cheap now? I am betting it is with my money. :)

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