The King of Hedge Fund Alley

Who do the new Masters of the Universe write their rent checks to? Chances are, it's to New York real estate developer Harry Macklowe.

Not so long ago, Harry Macklowe was perhaps best known for his long-running feud with billionaire homemaker Martha Stewart.

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Idiosyncratic Investors

For most shareholders, reading a company’s annual report is involvement enough. But other investors prefer to be much more engaged. Some will attend annual shareholder meetings if they’re being held nearby. Some will travel to celebrated gatherings such as Berkshire Hathaway’s meeting, for which hordes of share owners make a quasi-religious pilgrimage to Omaha, Nebraska, to hear Warren Buffett speak. For More...

Opening Up the Citadel

Hedge fund wunderkind Ken Griffin has $13.5 billion at his disposal—and he definitely knows how to use it.

The people who run hedge funds, as everyone knows, are tight-lipped. But even by the lockdown standards of the industry, Citadel Investment Group and its founder, Ken Griffin, stand out. He has his employees sign such strict nondisclosure agreements that one former executive deadpanned over the telephone, "I’m not allowed to even say the word Citadel to you."

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A hedge fund superstar

Citadel founder Ken Griffin is already one of the world's most powerful investors. But he wants to be much more than a billionaire wunderkind with a head for figures. Fortune's Marcia Vickers takes an unauthorized look inside his world.

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A Legion of Disciples - Fund managers put their own spin on Buffett's strategy

Even though Warren Buffett has been influencing investors for decades, Legg Mason portfolio manager Robert Hagstrom had never heard of him until 1984 when he was 28 years old and training to be a stockbroker. Reading Berkshire Hathaway's annual reports "was one of those episodes in life where that which was mysterious became much clearer," says Hagstrom, who has since written several investing books, including The Warren Buffett Way. "What [Buffett] did was basically put flesh on stocks which previously to me were just ticker symbols and numbers."

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What Do the Rich and Powerful Read?

A Look at the Once and Future Wall Street Journal

An old joke in the newspaper world holds that The Wall Street Journal is read by the people who run the country, The New York Times by those who think they run the country, The Washington Post by those who think they ought to run the country and The Boston Globe by people whose parents used to run the country।

Whether or not that is true, The Wall Street Journal does hold tremendous sway। It reaches one of the largest audiences and has some of the richest and most-powerful readers of any newspaper।

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Whitney Tilson: Human qualities in management matter for long-term success

Assessing management quality is clearly one of the most important aspects of an investment decision. To a large extent, equity investors put their hard-earned capital into the hands of management and count on it being employed skilfully and honestly. When that doesn’t happen, losses typically follow.

We recently compiled for the newsletter I co-edit, Value Investor Insight, a “greatest hits” collection of insights from many of the best investors in the business. Given that the experience of others can be a wonderful teacher, I’ve assembled some of the best: More...

Q&A : Thoughts Of Li Ka-Shing

The following is an edited transcript of an interview with Chinese entrepreneur Li Ka-Shing, conducted in China on Dec. 4:

Forbes: We wanted to start by exploring your arrival in Hong Kong, your background. You're obviously influenced by your father, a teacher. He instilled in you a deep thirst for reading and knowledge. It sounds as if, despite the difficulties of your early career, you are an optimist about the future. Would you classify yourself as an optimist?

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Interview with Prof. Sanjay Bakshi

CIO: Thank you for giving us the time to talk to you.

Prof. Sanjay Bakshi: It's a pleasure to meet you here in my office. We are meeting after more than four years and I remember very fondly what happened on the previous occasion! Indeed I still get fan mails from people about the talk I delivered at your invitation at the Oxford Bookstore in 2002. I don't talk to the media. I talk to my students in the classroom at MDI (six months in a year) and I frequently talk to some value-oriented friends. You are the only one whom I have met from the media in the last four years!

CIO: Many thanks.

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Interview with Michael J. Mauboussin

This interview was taken before he joined Legg Mason.


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Interview with Mr. Jack Schwager

CIO: Thank you Mr. Schwager for taking out time and talking to us. Over your long career in the markets you have interacted with some of the greatest traders. Could you share with us what you perceive are the qualities of great traders?

Jack Schwager: There are really very many. I will give you a few key ones. First on the list would be discipline. I can't think of anybody I have interviewed or met as a trader who has been very successful but has not been disciplined. I think that's probably an absolute essential.
Secondly, money management and risk control is certainly critical in one form or another. Most of the traders that I have interviewed will be the first to acknowledge that they consider money management actually more important than the methodology.

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Interview with Paul Tudor Jones II

Paul Tudor Jones is a legendary commodity trader. Below is his interview and our comments.

Paul Tudor Jones II is the president and founder of Tudor Investment Corporation, and was featured in Jack D. Schwagers classic "Market Wizards". This is an edited transcript from the interview, which was held at Paul Jones's office in Greenwich, Connecticut on January 13, 2000.

Q: Can you briefly describe your background?

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SEED INTERVIEW: JAMES SIMONS

James Simons is sometimes referred to as 'Elvis' within hedge fund circles. He's the king, and you always know when he's left the building.

If you haven't heard of him, it's because he deliberately maintains a low profile. In Simon's business, secrecy is the key to abiding success. But, when rumors spread in 2005 that he was starting a new $100 billion hedge fund, people outside of his field also began to take notice of him.

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Invest Like Prince Alwaleed

Prince Alwaleed bin Talal, the billionaire investor often referred to as the “Warren Buffett of the Middle East,” has announced that he will soon bring his investment company, Kingdom Holdings, public on the Saudi Arabian exchange.

Prince Alwaleed is primarily a distressed value investor who made at least half his $24 billion net worth in three investments back in the nineties: Citigroup, AOL, and Apple. It’s hard to think of these at distressed value positions but each of these stocks was considered on the brink of death right when the Prince began loading up. It’s worth seeing what positions he’s in now to see where he still finds value.

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The World at $100 a Barrel

Oil prices have surged again, and investment bank Goldman Sachs thinks they have the potential to spike to near $100 a barrel by the end of summer unless Middle East production increases. How would a rise to, say, $95 a barrel affect the global economy? Some key take-aways from a new analysis by the bank:


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Buffett holds sway in the White House horse race

Someday soon, Warren Buffett may have to apply his legendary stock-picking skills to the candidates clamoring for his endorsement in the 2008 presidential race. For now, the plainspoken Nebraska billionaire appears to be enjoying his role as an unaffiliated kingmaker, raising money for Democrat Hillary Rodham Clinton, while promising to do the same for her chief rival, Barack Obama. He's even heaped praise on New York Mayor Michael Bloomberg, who recently left the Republican Party and might join the race as an independent. ''As the markets often would follow Buffett's investments, I think that same mentality would follow his political activities, too,'' said Joseph Marbach, a Seton Hall University political science professor.

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How Microsoft conquered China

Mr. Bill Gates! Mr. Bill Gates!" a young woman shrieks as the black car pulls up. A pallid student in a nylon windbreaker pushes his way through the security line and hands the world's richest man a small envelope with a floral design. "It's very important," he pants.

Another day in China, another round of adulation. Today the Microsoft (Charts, Fortune 500) chairman is being named an honorary trustee of Peking University. Yesterday it was an honorary doctorate from Beijing's Tsinghua University - the 13th in the school's 82-year history. Gates, wearing the same lopsided grin he has had on his face for the past few days, takes the envelope from the young man. For him this is a triumphant visit to China, a victory lap of sorts, on which I've been invited to tag along. The country is his.

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King of Bling

How a poor boy from London's East End became the most exclusive diamond merchant you've never heard of.

British billionaire Laurence Graff, the man jewelry business insiders call the new Harry Winston, swears this story is true: A woman and her husband walk into Graff's shop on London's swanky New Bond Street and ask to see the stunning diamond-and-ruby necklace in the window. It's the woman's birthday and hubby wants to buy her a bauble. At $2 million, however, he feels the price is too steep. Instead he offers $1 million and exits the store, giving the jeweler 24 hours to cash the check. Later that day the lady returns with a second man, her lover.

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Q&A : 10 Questions to Mohnish Pabrai

GuruFocus readers are given an opportunity by Mr. Mohnish Pabrai (also a GuruFocus reader) to ask 10 questions. We got answers back from Mr. Pabrai to some questions.

There were overwhelming responses and we have received more than 100 questions. We are very proud of the quality of the questions that our readers asked. We sent 17 questions to Mr. Pabrai. These are his answers to some of them.

Interview Part IInterview Part II

The ringgit debate

Experts see many benefits in a stronger currency.

Malaysia's macroeconomic health appears to be better than ever, and while it is easy to attribute this to the roaring stock market, a big reason for the rally is the strengthening of the ringgit.

Since the seven-year peg was removed in July 21, 2005, the local currency has appreciated 12% against the US dollar. It now trades in a managed float against a basket of undisclosed currencies and hovers at the RM3.40 level versus the dollar.

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CNN Money: World's Hottest 31 Startups

CNN Money: World's Hottest 31 Startups
Not all of the startup action happens in Silicon Valley. Business 2.0 Magazine picks the top websites outside the U.S. that are changing the world.

Back to the Future of Banking

Looking back at banking 20 years ago, it is clear that this industry became entrapped in “legacy” issues that resulted in slow action, poor risk decisions, and, ultimately, massive consolidation during a time of innovation and change in the economy.

“Banks,” as they were known back in the first decade of this century, acted primarily as financial intermediaries. They took in money from depositors and lent it out to borrowers. While it had been clear for many decades that the intermediary role of bankers was fast being squeezed, few executives in the industry were able to grasp the impact of Internet technology and increased entrepreneurial competition in the early part of this century. In addition, historians indicate that the banking industry’s long-established reputation for trust began to erode substantially over the past 20 years as more desperate efforts to maintain profit growth resulted in products, pricing and policies that ultimately were blatantly against the interest of consumers.

There were four major causes that led to the banking industry’s problems:


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Buffett's Berkshire reportedly buys Kraft stake

LONDON (CNNMoney.com) -- Investment guru Warren Buffett's Berkshire Hathaway has bought a small stake in Kraft Foods, according to a report published Thursday.
Berkshire's (Charts) stake is less than 5 percent and was acquired before it became known last month that activist investor Nelson Peltz had bought a position in Kraft, the Wall Street Journal said, citing a source close to the matter.


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Could Hurricanes Blow Subprime Debt Investors Away?

What happens if large-scale hurricane losses arise when securitized debt markets are tanking or seizing up? Might reinsurers be required to fund claim payments at the same time they face losses and illiquidity in their investments?

In 2005, hurricanes Wilma, Rita, and Katrina wreaked devastation in Florida, New Orleans, and much of the Gulf Coast. Insured losses set a record for a single year. Catastrophe reinsurance providers took a significant hit, but they generally stood behind their promises to pay catastrophe claims.


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An Evening with Mr. Greenblatt

Mr. Greenblatt, author of The Little Book that Beats the Market, treated members of the NYSSA to a special evening program on " Special Situations Investing".

Providing a wonderful glimpse into the evolution of his investment mindset, Mr. Greenblatt opened with an account of his college years - working with Rich Pzena to deconstruct the methods of Benjamin Graham. In the late 1970s, Mr. Greenblatt recalls, he "read a Forbes article about Graham" that discussed Net-Net Strategy, that is - stocks trading below liquidation value.



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Bill Miller: What's luck got to do with it?

The streak may be over, but Bill Miller remains the iconic fund manager of his generation. As manager of Legg Mason Value Trust, he beat the market for 15 years in a row until his run ended last year.
If you had invested $10,000 in Miller's fund in 1990, you would have $92,033 today.
Bill Miller

With suits so rumpled they can resemble pajamas, Miller pays no attention to style. He shows the same contempt for convention when he invests.
While most value investors refuse to buy technology stocks, Miller has made a killing on Amazon (Charts, Fortune 500), AOL, Dell and eBay (Charts, Fortune 500).
A former graduate student in philosophy who earlier served as a military intelligence officer, Miller probably has the most original mind in the investing business.
Money Magazine's Jason Zweig caught up with him recently - below is the full transcript.


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