Learning Resources

5 Famous Value Investors You Can Copy From

06 Dec 2021

5 Famous Value Investors You Can Copy From | VI
(c) Sadie Xiao

We look up to people who have proven themselves worthy of the spotlight they get. Having someone who inspires you is a boost to continue hustling.

In investing, it’s the same. More often than not, we copy the strategies of those who have been doing what we want to do and are getting incredible returns.

Below is a list of six of the most famous value investors in history. You’ll be surprised how they are the same as you, fuelled by the motivation to make profits in the stock market and sharing the same principle with you concerning undervalued stocks.

1. Charlie Munger

Famous Value Investors | Charlie Munger | VI

Does his name sound familiar? You probably have heard Charlie Munger’s name side by side with Warren Buffett’s. It’s because he is the vice president of Berkshire Hathaway, Buffett’s company.

Munger can be described as Buffett’s wingman. Nonetheless, he is a successful value investor in his own right – independent of Buffett.

If you aren’t aware, Munger chairs the Daily Journal Corporation and makes the most important decisions, besides providing expert investing advice, about the company’s investments.

Munger’s investing principle is similar to what value investing advocates – to invest in a company/stock that has good value with a fair price.

A value investor that Munger is, it is not a surprise that the Daily Journal Corp only invests in five companies: Bank of America [NYSE:BAC], Wells Fargo [NYSE:WFC], US Bancorp [NYSE:USB], Posco [NYSE:PKX], and Alibaba [NYSE:BABA]. His recent controversial move investing in BABA despite the regulation changes in China made waves and investors around are torn whether to follow suit.

2. Mohnish Pabrai

Famous Value Investor | Mohnish Pabrai | VI

A fund manager with a background in Information Technology, Mohnish Pabrai is often called the “new Warren Buffett.” And he really does admire Buffett, as evident in his efforts just to have an opportunity to have an audience with Buffett.

Before he became a fund manager and established Pabrai Investment Funds, which now manages more than $600 million in assets, Pabrai sold his IT business – a move that was unwelcome in his circle. Then again, the most popular option is often not the best one; hence, we see Pabrai now basking in the glory of his previous decision.

If you’re interested to invest beyond the US markets, you can further research Pabrai’s methods. His investments are concentrated in India and other emerging markets, as he feels there are very few value investing opportunities in the US.

Nonetheless, his results speak for Pabrai’s success as a value investor.

3. Joel Greenblatt

Famous Value Investors | Joel Greenblatt | VI

Joel Greenblatt is most famous for his The Little Book That Beats the Market, where he proposed a “magic formula” for value investors.

According to him, this formula is as simple as ranking companies using their earnings yield and return on capital, and then buying the top-ranking companies. You can also phrase it as quantifying the economic advantage of the companies and ranking them.

Greenblatt made this list as he has achieved amazing returns throughout the years. Some even say his results are more than what Buffett has achieved within a 20-year timeframe.

4. Warren Buffett

Famous Value Investors | Warren Buffett | VI

What’s the list of the world’s most famous investors if Warren Buffett is not included?

We all know his story from someone who has invested at a young age to becoming one of the world’s most influential people.

Buffett studied under Benjamin Graham himself in the Columbia Business School. And yes, he also copied from Graham before coming up with his personalised value investing strategy.

Now, Buffett’s net worth is at $103 billion. His company, Berkshire Hathaway, has been getting 20% annual returns since 1965. It’s no wonder he’s now one of the wealthiest people on earth.

And you also know by now that Buffett practises what he preaches, holding his stocks for the long term, including his most popular investments, Coca-Cola [NYSE:KO] and American Express [NYSE:AXP].

At 91, Buffett lives a humble lifestyle and plans to donate his wealth to charity once he passes. But what’s probably the best thing we all can copy from him is his habit of reading books every day.

5. Benjamin Graham

Famous Value Investors | Benjamin Graham | VI

The Father of Value Investing, Benjamin Graham is the investor we could all copy from. Although value investing today isn’t exactly the same as what he taught decades ago, some principles remain the same. Hence, we recommend brushing up on a little history and the basics of value investing from Graham’s book The Intelligent Investor.

Graham was also the one who coined the term “margin of safety” -- an important concept we refer to in making investment decisions.

And well, he’s Buffett’s mentor.

Interested to learn value investing further? Come to our free two-hour masterclass.

DISCLAIMER

This article and its contents are provided for information purposes only and do not constitute a recommendation to purchase or sell securities of any of the companies or investments herein described. It is not intended to amount to financial advice on which you should rely.

No representations, warranties, or guarantees, whether expressed or implied, made to the contents in the article is accurate, complete, or up-to-date. Past performance is not indicative nor a guarantee of future returns.

We, 8VI Global Pte Ltd, disclaim any responsibility for any liability, loss, or risk or otherwise, which is incurred as a consequence, directly or indirectly, from the use and application of any of the contents of the article.