Category Archive

During his recent interview with Tim Ferriss, Michael Mauboussin explained why investors should always consider comparing opportunities with appropriate references. Here’s an excerpt from the interview: Mauboussin: But the broader lesson is that no matter what you’re thinking of doing, moving to a new city, taking a new job, anything … Read More

In this interview with Trend Following Radio, Michael Mauboussin discusses why investors should focus on those things that they can control. Here’s an excerpt from the interview: Mauboussin: I think many traders think about this way too which is do everything you can within your power to succeed and then … Read More

In this interview with Invest Like The Best, Michael Mauboussin explains how to use a ‘value stick’ framework. Here’s an excerpt from the interview: Mauboussin: Imagine a vertical stick from top to bottom. At the very top, you have willingness to pay. Below that is price, then cost, and at … Read More

In his latest paper titled – Capital Allocation – Results, Analysis, and Assessment, Michael Mauboussin discusses five principles of good capital allocation that can be used as a benchmark to assess management. Here’s an excerpt from the paper: 1. Zero-based capital allocation. Two empirical observations from the prior discussion are … Read More

During his recent interview on the 20VC Podcast, Michael Mauboussin explained how to build your investment process. Here’s an excerpt from the interview: Mauboussin: One thing I would just say Harry about building a process is the first thing to think about and think about deeply is actually what you’re … Read More

In his recent interview with Motley Fool Money, Michael Mauboussin explains why investors should look for businesses that have ‘option value’. Here’s an excerpt from the interview: Michael Mauboussin: I think there are two big things to think about, and I’m sure this is what you guys are thinking about when … Read More

In his latest paper titled – Good Losses, Bad Losses, Michael Mauboussin explains why investors must look past simple measures of profits to understand a business’s true ability to create value. Here’s an excerpt from the paper: Accounting is the language of business that allows a company to share its … Read More

In his recent interview on the Capital Allocators Podcast, Michael Mauboussin discussed the best time to invest after a 20% market drawdown. Here’s an excerpt from the interview: If you’re taking a longer term point of view I think it does become a margin of safety concept and just figuring … Read More

In his recent interview with WHG Clube do Livro, Michael Mauboussin discussed one example of how companies destroy wealth. Here’s an excerpt from the interview: Mauboussin: The third observation is that if you’re not earning your cost of capital, growth is bad. The faster you grow the more wealth you’re … Read More

In his latest paper titled – Wealth Transfers: Redistribution of Value via Capital Allocation, Michael Mauboussin explains why investors should pay more attention to management’s actions regarding buying and selling the company’s stock. Here’s an excerpt from the paper: Companies can affect wealth in a couple of ways. First, they … Read More

In his latest paper titled, Intangibles And Earnings – Improving The Usefulness of Financial Statements, Michael Mauboussin explains why one size does not fit all when it comes to financial statements. Here’s an excerpt from the paper: The goal of accounting, the language of business, is to provide financial information … Read More

In his latest paper titled Feedback- Information as a Basis for Improvement, Michael Mauboussin explains how feedback can improve your investment process. Here’s an excerpt from the paper: Feedback is information that is applied to improve results. In this report, we focused on how feedback can improve the long-term outcomes … Read More

In his latest interview with eToro, Michael Mauboussin discusses when negative free cash flow makes sense. Here’s an excerpt from the interview: Mauboussin: The other thing that I would just underscore is that there have been and there will continue to be great businesses that have negative free cash flow. … Read More

In his latest interview with TMF, Michael Mauboussin offers a framework for investors to analyze any M&A deal. Here’s an excerpt from the interview: M&A deals generally have a strategic and a financial rationale. A target company may be a great business but the acquirer still risks overpaying if its … Read More

In his latest interview on Masters in Business, Michael Mauboussin discussed the three buckets of investing in today’s markets. Here’s an excerpt from the interview: RITHOLTZ: So — so here’s the pushback that I think we would get from a Robinhood trader today who is looking in their portfolio over … Read More

In his book – Think Twice: Harnessing the Power of Counterintuition, Michael Mauboussin explains why smart people make dumb decisions. Here’s an excerpt from the book: No one wakes up thinking, “I am going to make bad decisions today.” Yet we all make them. What is particularly surprising is some of … Read More

In his recent interview with RIAIntel, Michael Mauboussin discussed a number of topics including what distinguishes a great investor from a good investor. Here are some excerpts from the interview: What distinguishes a good from a great investor? This difference rarely has to do with the tools they’re using but … Read More

In his book Expectations Investing, Michael Mauboussin provides a simple explanation of how to calculate the present value of an investment. Here’s an excerpt from the book: We return to first principles to see why the stock market bases its expectations on long-term cash flows. A dollar today is worth … Read More

In their book – Expectations Investing: Reading Stock Prices for Better Returns, Michael Mauboussin and Alfred Rappaport discuss how to use the expectations investing process. Here’s an excerpt from the book: THE EXPECTATIONS INVESTING PROCESS In the following chapters, we’ll walk you carefully through the three-step process of expectations investing. Step … Read More

In his latest paper titled – Categorizing for Clarity, Michael Mauboussin shows how reclassifying certain items in the cash flow statement can substantially improve the description of a business, without impacting the integrity of the cash flow statement. Here’s an excerpt from the paper: Understanding the magnitude and prospective return … Read More