Letters To Shareholders We Like

A good source for improving analysis skills is to see what other successful investors are doing. We like to read mutual fund shareholder letters and other materials to generate ideas or learn something new. Here are some letters and research papers we like..

  • Tweedy Browne’sWhat Has Worked In Investing”  has been around for over 20 years. It is still worth reading today. Chris Browne’s, Value Investing and Behavioral Finance.
  • Marty Whitman and his team at Third Avenue Management always write detailed, thoughtful letters to shareholders. Marty usually spends several pages expanding on his idea of  “Fundamental Finance”.  The 2012 Annual Report goes into great detail about this philosophy.
  • Steve Romick and Richard Rodriguez of FPA Funds pen very insightful commentary and analysis in their shareholder letters and special commentaries.  Definitely a must read every quarter.
  • Baron Funds, while certainly not value investors, have well-written, thoughtful shareholder letters that do talk about many of the investing principals that we believe in. Ron Baron and Cindy Martinson write sections that we would encourage others to read.
  • Jeremy Grantham at GMO writes what we consider “must read” letters. His perspective is refreshing and more big picture thinking. GMO’s 7 Year Asset Class Forecasts have been extremely accurate and predictive of future returns. Registration is required, but it is free.
  • We have always enjoyed reading the Gabelli closed-end fund quarterly reports for their combination of analysis and humor.
  • While he tends to use more of a top down approach, we think investors can find value in John Hussman’s weekly commentaries and shareholder letters. Similar to Jeremy Grantham, Hussman gives lots of historical perspective on potential future market returns based on starting valuations which can give investors a good context for valuations in general.
  • For those who are academically inclined, LSV Funds have a page devoted to research papers that discuss various investing concepts and theories.
  • Longleaf Partners provides investors with a complete collection of past shareholder letters. The letters usually devote several paragraphs of analysis and discussion on their holdings. Since they run concentrated portfolios,  usually it is their highest conviction names that are discussed.
  • Charlie Royce and Whitney George of the Royce Funds write a good shareholder letter in the annual report of their funds. They take a longer-term view of things and balance it with current economic commentary. If an investor is really looking for some macro and big picture perspective, Royce, Hussman, Rodriguez and Grantham are four of the best to read.
  • Aegis Value Fund–  Shareholder reports are simple and to the point, but they do discuss an idea or two. One of our favorite funds.
  • Howard Marks Oaktree Letters. These are a must read. They can be found here.
  • East Coast Asset Management Quarterly letters are full of commentary on investing theory and ideas.
  • Berkshire Hathaway Shareholder Letters – Of course no list would be complete without the Buffett letters.
  • Horizon Kinetics shareholder letters usually provide an interesting perspective on investing themes that are not always discussed elsewhere.
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