Readings from Montier & Mauboussin

[redcorolla95]

People to learn from

http://www.eurosharelab.com/james-montier-resource-page
http://www.eurosharelab.com/michael-maub...ource-page

[kazukirai]

Titled 'The seven immutable laws of Investing', I think this is a gem from Montier.

1. Always insist on a margin of safety
2. This time is never different
3. Be patient and wait for the fat pitch
4. Be contrarian
5. Risk is the permanent loss of capital, never a number
6. Be leery of leverage
7. Never invest in something you don’t understand

Some highlights:
- In point 1, Montier mentions the use of a deep value screen which is as follows:

1) Earnings yield of twice the AAA bond yield (as of writing, the 10 year AAA corporate bond is going for 3.98% which means this screen calls for a P/E of 12.6x).

2) Dividend yield of at least two-thirds of the AAA bond yield. (or 2.65%)

3) Total debt less then two-thirds of the tangible book value.

4) An extra criterion- a Graham and Dodd P/E of less than 16.5x

Read the full article here.

Any comments on tweaking the values for the Singapore context?