Patterns

Munger's 3 ideas for fishing: spinoffs, 13fs, andshare cannibals Huber's three sources of returns 1. Revenue Increase Consolidation in industry leading to rational supply. This happened to semi-conductors as I once viewed it as simply too cyclical and a commodity. Pricing Power 2. Capital Allocation Asset-light Share buybacks leading to cannibalization 3. Rerating of Multiples Story stock Sentiment 3 Types of Investments: Stable, recurring cash-flowing companies that have high ROIC; turnarounds that may seldom turn around, and cyclicals. Invariant perception is what is the market missing and what I think about the value. It has to be bridged. I can be good at identifying it, but luck will be the arbiter in the short-term until the thesis plays out.