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#10 Michael Mauboussin: Expectations Investing

Investing by the Books

CHAPTER

The Payoff for Private Deals

I've owned the two stocks I've owned probably for the longest time, this is 20 plus years, would be Berkshire Hathaway and Amazon.com. So they've both compounded at a pretty good rate. It's an interesting, especially with Amazon.com along the way, it's probably pretty likely that had I done an expectations analysis, there were certain pockets where it probably would have appeared to be high expectations. The payoff for private deals looks similar to an option where the median loses money, but where the big wins make up for it. Many businesses in the public markets, especially in technology, are often early in their journeys, and they are often money losing.

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