A few things struck me when I
first started to read Brookfield’s letter to the shareholders…The emphasis on a
long term time horizon for their investments and the importance they put on
capital allocation (capital recycling)…Think for a minute how this differs from
the daily headlines the financial media spews out, who fixate on the next
quarterly earnings reports and the daily movement of stock prices (algorithmic
trading?)
By reading these letters the
small investor can also gain added insight into the state of the economy and
where Brookfield are currently putting their money. And you get this
information for free on the internet but even better most investors don’t
bother to look at it making it underused information (your edge on the
competition).
There is more to investing than
just blindly following the numbers…check out the management team who not only
run the operations of the company but have to organize financing and allocate
the companies capital as well…This isn’t monopoly money we’re talking about
here…this is millions and in Brookfield’s case sometimes billions of
dollars…real dollars, the coin of the realm.
One last point…the competition
for short term information is cut-throat…extend your time horizons where there
is less competition for information. As Willie Keeler once opined, ‘hit em
where they ain’t’…Align yourself with good management teams who think long
term…the Letter to the Shareholders will shed a lot of light as to what type of
management team an investor might want to align himself with.
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