Co/Report

Share this post

Co/Report

coinvestorclub.substack.com

Co/Report

A Good Historian

Co/Investor Club
Feb 12, 2023
3
Share
Share this post

Co/Report

coinvestorclub.substack.com

Investor Education: 529 Plan

A 529 plan is a tax-advantaged savings plan designed to encourage saving for future education costs. 529 plans, named after the section of the Internal Revenue Code that created them, are sponsored by states, state agencies, or educational institutions and are authorized by Section 529 of the Internal Revenue Code. 

Read our feature on 529 Plans here!


A Good Historian

“The only fence against the world is a thorough knowledge of it.” —John Locke

The Nasdaq ended its five-week winning streak, falling 2.4% this past week. The S&P 500 also finished lower, down by about 1.1%.

As we wrote last year, knowledge of one’s holdings can give one confidence:

Knowledge about your holdings gives you the confidence to hold or add to your investments when they are down—if you know they are good—or to sell and invest in better things that you also know well. You are hedged because you know the difference between price and value and won’t let a declining share price affect your ability to act intelligently.

Knowledge of market history can also give one confidence. Not the confidence to predict what will happen in the future—we’ve spent plenty of time in these virtual pages discussing the difficulty of forecasting. But confidence that you understand what can happen—and have your portfolio positioned for that range of possibilities.

Bob Rodriguez, former Managing Partner and CEO of First Pacific Advisors, touched on this topic over a decade ago when discussing the best advice he ever received:

“In the fall of 1974 I was in graduate school at USC taking a portfolio-management investment course. The financial markets were in difficulty, and I didn’t understand how securities were being sold at such depressed levels. I had only recently discovered Security Analysis by Graham and Dodd when we had a guest lecturer come in named Charlie Munger, who went on about this idea of value investing. After the class was over, I walked up to Charlie and asked him if there was one thing that I could do that would make me a better investment professional. His answer was, ‘Read history, read history, read history.’ And so I became a good historian, reading both economic and financial history as well as general history.

“What I learned is that people relate to the crises they have experienced. So when the crisis of 2008 came, it felt like an old friend to me because it had so many similarities to the banking crisis of 1907. Asking Charlie's advice and then reading history allowed me to put those things in context.”

One of the main topics getting headlines over the last year or two is inflation. The markets seem to think the Fed now has it under control. But some people are pointing to signs that it might be about to heat up once again:

Twitter avatar for @INArteCarloDoss
#Turkeymeows KKGB (Carlo Casio) @INArteCarloDoss
#bigflip in one chart Debit and credit card total spending per household These are monthly y/y percentages Look at January
Image
8:24 PM ∙ Feb 10, 2023
535Likes57Retweets

Studying some history and looking back at the 1970s, we see that inflation was volatile. It came. It went. It came back. And then went away again. Etc.

One of the most important things to remember in business and investing is this: It’s not about prediction. It’s about positioning.

While the causes of inflation then and now aren’t the same and every cycle is different, it might be worth asking how your portfolio is positioned should inflation return. The market isn’t expecting it—but maybe you should, just in case.


Tweets of the Week

Twitter avatar for @Greenbackd
Tobias Carlisle @Greenbackd
EBIT/EV value spread has blown out to a new all-time high.
Image
5:27 PM ∙ Feb 7, 2023
333Likes39Retweets
Twitter avatar for @CfaDallas
Loic LeMener CFA, CFP® @CfaDallas
Insiders are selling. What is going on here?
Image
12:30 PM ∙ Feb 10, 2023
35Likes15Retweets
Twitter avatar for @MnkeDaniel
Daniel @MnkeDaniel
Chuck Akre is one of the greatest Investment Thinkers of all time! His Fund returned 15,3% p.a. over 23(!) years. His secret to investing is the “Three-Legged Stool.” Here’s how it works👇🏼
Image
3:42 PM ∙ Feb 8, 2023
403Likes107Retweets
Twitter avatar for @BrentBeshore
Brent Beshore @BrentBeshore
The ultimate life hack is to stop pursuing life hacks.
3:42 PM ∙ Feb 11, 2023
133Likes4Retweets
Twitter avatar for @altcap
Brad Gerstner @altcap
Data ia oxygen to AI - bullish that value of proprietary data going way up. Watch 15 seconds of video - @thejessezhang connecting external data sources from $SNOW to LLMs like GPT. Pace is 🔥. @hwchase17 @amasad @paulinebhyang loom.com/share/8564b931…
loom.comLoom | Free Screen & Video Recording SoftwareUse Loom to record quick videos of your screen and cam. Explain anything clearly and easily – and skip the meeting. An essential tool for hybrid workplaces.
7:27 PM ∙ Feb 10, 2023
122Likes14Retweets

In Case You Missed it…

Microsoft thinks AI can beat Google at search — CEO Satya Nadella explains why

Risk and Regret - by Morgan Housel

Where Have All the $200,000 Houses Gone?

The Education of a Value Investor Podcast: Sachin Khajuria on His Book, Private Equity, Distressed Investing and Multicultural Backgrounds

The Knowledge Project Podcast: #158 Aaron Dignan: Change The Way You Work

A Bit of Optimism Podcast: Taking Comfortable Risks with Scott Galloway

The Peter Attia Drive Podcast: #241 ‒ Living intentionally, valuing time, prioritizing relationships, and more keys to a rich life | Ric Elias (Part 2)


If you have not already upgraded your membership…

Sign Up Premium Member

Avenel Financial Group, a merchant banking and advisory firm located in Charlotte, NC, launched a new business venture called the Co/Investor Club. The Co/Investor Club is a community of value-oriented investors that collaborate on investment opportunities and ideas. You are receiving this newsletter because you are a Free or Premium Member of the Co/Investor Club!


Chat with Mike

Whether you’re an executive with investment opportunities or a college student looking to network, we would love to chat with you! Email our Founder, Mike Pruitt, at mp@coinvestorclub.com with questions and ideas or schedule a meeting.

Don’t forget to follow us on social media too!

Twitter: @coinvestorclub1

LinkedIn: Co/Investor Club

For our disclaimer, please visit our website.

Have friends that want to join? The Co/Report is public, so feel free to share!

Thank you for reading. Co/Report grows through word of mouth. Please consider sharing this post with someone who might appreciate it.

3
Share
Share this post

Co/Report

coinvestorclub.substack.com
Comments
Top
New
Community

No posts

Ready for more?

© 2023 Co/Investor Club
Privacy ∙ Terms ∙ Collection notice
Start WritingGet the app
Substack is the home for great writing