Smead Capital Management is a Seattle-based investment firm that manages a high quality, large-cap value portfolio with boringly dry turnover via separate accounts, subadvisory, and mutual funds in the United States and abroad. We are contrarians and welcome like-minded investors on this journey.

1001 4th Avenue, Suite 4305
Seattle, WA 98154
877.701.2883
www.smeadcap.com

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Commentary

Beating Bobby Fischer

We think this is an excellent time to ponder the thoughts of Buffett and Munger.

Commentary

Simon Says

The object of the game was to get to the finish line first and then become the leader the next round. The stock market has its own game of “Simon says” and that is in the mall property world.

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Vexing Today’s Convex Pricing Behavior

Fortunately, human behavior has a history of repeating itself at extremes. The worst buying decisions are made at the top. Just like bonds, the convexity is true when yields rise going forward. It’s a slippery slope and could be vexing.

Commentary

Tesla and GameStop: Pass the Dutchie?

We have enjoyed watching what happens in the late stage of a financial euphoria episode play out in the escapades of millennial investors on Reddit, who seem to “rule the nation.” While politicians, regulators, the media and others try to sort this out, we thought some historical perspective might be helpful.

Commentary

The January Effect

There have been a small number of consistent alpha-creating axioms in the U.S. stock market over time. Value beat growth over long time frames, tech stocks hit bottom in the summer and crowded trades separate you from your money, to name a few.

Commentary

Outlook 2021: “Frenzy” is the Opposite of Bull Market Stew

Our outlook for 2021 is formed by the need to get away from the crowd and to expect some very stormy weather in the U.S. stock market. We are not afraid of drowning. Therefore, we will review the circumstances at the bottom of the market in 2009 with today’s market to see where the crowd is and where we need to go to avoid the coming storm.

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Throwing Caution

As we begin 2021, the investing public is tied up in a “frenzy,” to quote Charlie Munger from a recent interview. This “frenzy” can be captured a couple ways.

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From the Impatient to the Patient

As we enter 2021, it appears that Buffett had things upside down in 2020. The things which had gone up the most by the end of 2019, went up the most in 2020.

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Famed Climatologist Charlie Munger

We were fortunate to watch a recent interview Charlie Munger did with Cal Tech as a distinguished alum. We consider him to be one of the most successful contrarian investment thinkers on the planet. At 96 years of age, he has no fear of being politically incorrect. We contrast this with the mountain of writing, media and rhetoric associated with the topic of climate change.

Commentary

Net Present Value Bargains

There appears to be a few huge statistical bargains available in the stock market based on the simplified version of Benjamin Graham’s intrinsic value calculation.

Commentary

Reminiscences of an eBay Operator

My wife brought me a box of ornaments that my mother has given to us over the years. I decided to check what I could sell them for on eBay (EBAY). What a great way to look at what is going on in equity capital markets!

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People Need People

In all this tech euphoria and COVID-19 quarantining, investors are missing a key fact. People need people.

Commentary

One Helluva Party

As Buffett said, this looks like “one helluva party” with the individual investors, professional investors and insiders all joining in the fun. As a former fraternity member in college, the best parties were always when you couldn’t find anyone missing. It wreaks of that today in the stock market.

Commentary

WFH is a WKF

We came up with a theory many years ago to address how important psychology is to owning common stocks. We found that the risks go up in a stock market, or in an individual stock, when a “well-known fact” (WKF) was acted on in the extreme.

Commentary

Cherry Picking is Tempting

When you run an equity portfolio which is concentrated in 25-30 common stock selections, there are usually three stocks which stick out as particularly attractive at any given time.