Thursday, November 25, 2021

15 tips from ‘super-investor' Schloss a stock investor must always follow

Nov. 25, 2021

Here is the article.

Walter Schloss was one of the most successful investors of all times, but very few outside the close circuit of value investors know about his investment exploits.

Investors these days have the luxury of fast internet connections and a deluge of information to track potential stock drivers and make a quick profitable trade.

One Wall Street legend did it all without ever having touched a computer or accessing the internet.

Walter Schloss was one of the most successful investors of all times, but very few outside the close circuit of value investors know about his investment exploits.

Born in August 1916, Schloss had no formal qualifications and began working as a runner on Wall Street in 1934 before serving in the US Army Signal Corps. He eventually became a notable follower of the Benjamin Graham School of Value Investing, after he took investment courses taught by Benjamin Graham at the New York Stock Exchange Institute.

Later, he worked for Mr Graham in the Graham-Newman Partnership, where he also happened to meet Warren Buffett.

In 1955, he founded his own firm: Walter J Schloss Associates, where he racked up one of the best records in investing history until he passed away in 2012. In his over 40 year career as an investor, Schloss compounded his money at 16% year after year, a record that is still difficult to match for the best of investors.

In 1984, Warren Buffett named Schloss one of the ..

Investment philosophy
Schloss had the knack for picking stocks when they were hitting new lows and the ones trading at prices lower than their book values per share. Besides buying stocks of the firms below book values, he also looked at a firm's management to check whether they were overly greedy or honest.

This information helped him know how the management ran the business over the years and gave a good prediction whether the firm's business would prosper in the future.

Schloss believed it was better to buy stocks than bonds because of their growth potential. He also limited his holdings in one stock to no more than 20% of his entire portfolio. But at any given time, he was never shy of holding up to 100 different stocks in his portfolio.

He weighted his holdings based on their perceived values, putting less money in positions he was less sure about. He used limit orders to purchase stocks, so that he could decide on the price he was willing to pay.

No comments:

Post a Comment