According to Guru Arnold Van Den Berg's value investor wisdom: "The lesson for investors is that even though the economy may not be in great shape, when stocks sell at deeply discounted prices relative to their intrinsic values, thus accounting for all the seemingly insoluble problems of the time, stocks should be bought aggressively." At a recent public employment retirement systems conference in Texas, Guru Arnold Van Den Berg, CEO and co-chief investment officer of Century Management, summarized the three investment performance drivers as inflation, interest rates and business fundamentals. Business trends in the U.S. look very positive for the long run, according to Van Den Berg, who also warned that the valuations of stocks and bonds warrant caution. He explained that inflation must be monitored, and added that their direction will be determined by what the Federal Reserve does, telling the audience that the most important thing is not to get locked into an opinion until they see what the Federal Reserve is going to do.
Century Management’s portfolio of 62 stocks has a total value of $1.02 billion, and a quarter over quarter turnover of 8%. Let’s see how Van Den Berg’s wisdom applies to the performance of his top three holdings. Continue Reading »