What have David Rosenberg and Seth Klarman got in common? Diddly squat as far as I know, except they wrote the best two things I’ve read in the last few days.

I had assumed Klarman would quickly sell his holding in Facet for two reasons. In his ironically over valued classic Margin of Safety he highlighted the initial downwards share price path of spin-offs due to institutional selling creating a temporary supply-demand imbalance. I also thought he might be a tad gun shy of speculative biotech after his recent ACUS debacle. However, according to this recent filing Klarman has indeed upped his stake to 3,985,567 shares or 16.68% of Facet.

Compare new picks to current holdings is another great piece of advice which Klarman mentions and is a stepping stone on most investing paths. Can AXP dislodge STP or GE? Where will I deploy my WINS cash? STP main risk’s are the same as for most solar and tech companies.

One of my aims for the Fusion Portfolio was to dispel or at least shake the certainty of belief many individuals have in always being 100% invested. Somehow people made a link between not being able to time the markets and being 100% invested when there is no link. I find it as crazy as suggesting beta is a good measure of risk.
The following chart shows the percent invested for the Fusion Portfolio compared to the ASX200 Index. As the index has moved from overvalued to undervalued the fund has …

I’ve still got plenty more to learn from Klarman, though I will never follow his exact path. I’d be disappointed if I’d shelled out a grand for Margin of Safety. Klarman would call the trading of his book at Amazon “trading sardines”.

In the short term I’m not sure where our current path leads us. However, in the long term stocks are currently cheap and should provide excellent returns. Plus a free copy of Margin of Safety.