We Study Billionaires - The Investor’s Podcast Network

TIP710: Common Stocks and Common Sense w/ Kyle Grieve

75 snips

Mar 30, 2025

Kyle Grieve emphasizes the power of common stocks and contrarian thinking for maximizing returns. He shares insights on accepting imprecise valuations and learning from disappointing investments. The discussion includes strategies for spotting great investments and the significance of market cycles. Listeners will discover how averaging up can be an advantage and the mindset needed to navigate market panic. Case studies on companies like IBM and General Motors highlight the value hidden in volatility, showcasing successful long-term investing.

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INSIGHT

Common Stocks and Emotional Mistakes

Common stocks offer simple wealth generation with 10% average returns and liquidity.
The key challenge is avoiding emotional mistakes like panic selling during market downturns.

INSIGHT

Volatility as Opportunity

Ed Wachenheim, like Buffett, doesn't see volatility as risk, creating advantages for value investors.
This divergence allows buying opportunities when market fear lowers prices.

ANECDOTE

1987 Crash Anecdote

During the 1987 market crash, Ed Wachenheim's friend panicked and sold stocks.
The market rebounded 50% over the next two years, proving the mistake of short-term thinking.

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Common Stocks and Common Sense

The Strategies, Analyses, Decisions, and Emotions of a Particularly Successful Value Investor

Edgar Wachenheim III

Common Stocks and Common Sense provides detailed insights into common stock investing using real-world case studies. Edgar Wachenheim shares his experiences and strategies, emphasizing behavioral economics and the human side of investing. The book offers actionable guidance for developing a successful investment mindset and includes discussions on emerging industries like electric vehicles.

What I Learned about Investing from Darwin

Pulak Prasad

In this book, Pulak Prasad offers a unique approach to investing by leveraging principles from evolutionary biology. He argues that the investment profession is in crisis, with most equity fund managers unable to beat the market over the long term. Prasad draws lessons from Darwinian concepts, using examples such as bumblebees' survival strategies, experiments in breeding tame foxes, and a small frog’s mimicry of a larger rival to illustrate investment principles. He outlines three key mantras for investing: avoid big risks, buy high quality at a fair price, and don’t be lazy—be very lazy. The book advocates for permanently owning high-quality businesses and provides practical insights into how evolutionary strategies can improve investment decisions.

One Up On Wall Street

Peter Lynch

In 'One Up On Wall Street,' Peter Lynch explains how average investors can outperform professionals by leveraging their everyday experiences and knowledge. Lynch advocates for investing in companies and products that are familiar and understandable, rather than following trendy or complex investments. He provides easy-to-follow advice on analyzing financial statements, identifying different types of companies (such as cyclical, turnaround, and fast-growing companies), and maintaining a long-term investment strategy. The book emphasizes the importance of simplicity, patience, and fundamental analysis in achieving successful investments.