Extracts from our Quarterly Letters:

• Ground Rules, from Letter to Investors dated July 2019

• Characteristics of businesses we like (and own), from QE Dec 2019 Quarterly Letter

• Thoughts on lending financial services (lenders), from QE Jun 2020 Quarterly Letter

• Importance of the underlying industry while investing in a business, from QE Jun 2021 Quarterly Letter

Other writings:

Sanjeev Vaidyanathan's answer to What are the top lessons that can be learned from Charlie Munger? - Quora

The top 3 lessons that I have learned from Charlie Munger:

• Lead a good and trust-worthy life - and give back to society

• "It is a grand mistake to think of being great without goodness and I pronounce it as certain that there was never a truly great man that was not at the same time truly virtuous" (Ben Franklin)
• "The only life worth leading is dedicated in substantial part to good outcomes that one cannot possibly survive to see" (Cicero)
• “In your own life, what you want to maximize is a seamless web of deserved trust.” (Charlie Munger)

• Obsess about the one thing you want to be great at - and understand the concept of circle of competence

• "Find out what you're best at - and keep pounding away at it" (Simon Marks, Marks & Spencer)
• "I'm smart in spots and I stay around those spots" (Thomas Watson Sr, IBM)

• Obsess about your (and others') behavioural biases and try to reduce irrational behaviour

• For more, please listen to Charlie's 1.5 hour speech on human misjudgment (though would recommend the slightly updated version in the Almanack over the audio):……Read more

Sanjeev Vaidyanathan's answer to Is there such thing as a strategy like Ben Graham's value investing, but in the technology sector? - Quora

As Warren Buffett has repeatedly mentioned, the three key principles (on which the investing strategies are based) of Ben Graham's value investing are:

• Stocks represent part ownerships in the underlying business
• The concept of Mr Market as a manic-depressant who provides you daily opportunities to buy and sell
• Margin of safety = importance of the buying price being far below intrinsic value

Do these principles apply to the technology sector? Absolutely. All three principles are relevant to any sector

What makes applying investing strategies based on these principles difficult in technology sector? I think it has primarily to do with coming up with even a range of intrinsic valuations for such companies and hence ascertaining a margin of safety while buying…. Read more

Sanjeev Vaidyanathan's answer to What does Warren Buffett mean by competitive advantage? - Quora

• Firstly, Warren Buffett refers to these competitive advantages as moats. Here is one such quote of his that should help define moats (one of my favourite quotes):

• A truly great business must have an enduring “moat” that protects excellent returns on invested capital. The dynamics of capitalism guarantee that competitors will repeatedly assault any business “castle” that is earning high returns. Therefore a formidable barrier such as a company’s being the low- cost producer (GEICO, Costco) or possessing a powerful world-wide brand (Coca-Cola, Gillette, American Express) is essential for sustained success. Business history is filled with “Roman Candles,” companies whose moats proved illusory and were soon crossed.

• Our criterion of “enduring” causes us to rule out companies in industries prone to rapid and continuous change. Though capitalism’s “creative destruction” is highly beneficial for society, it precludes investment certainty. A moat that must be continuously rebuilt will eventually be no moat at all….Read more