The Intellectual Investor – Value Investing by Vitaliy Katsenelson

Lately, I’ve been getting this powerful feeling that everything I touch turns to gold. Every time I buy a stock, it goes up. Did I finally figure out the stock market game? Did I find a secret way to follow Will Rogers’ advice: Buy stocks that go up, and if they don’t go up, don’t buy them?

No. I didn’t get much smarter. I was simply a willing participant in the latest cyclical bull market. A bull market makes you feel smarter than you are, the same way a bear market makes you feel dumber than you are.

This piece is a small excerpt from my first book, Active Value Investing (2007), which I later rewrote into The Little Book of Sideways Markets. I still stand by every word, but the older, more mature Vitaliy has some additional thoughts to share at the end.

I walk through why feeling smart makes you do the opposite of what you should be doing, and my favorite trick for reminding myself how dumb I am (it involves pulling out an old annual report on a stock I lost a boatload of money in). I discuss the four-letter word R-I-S-K, the “buy and forget to sell” investor a bull market quietly creates, and why every sell looks dumb in the moment. I talk about selling discipline, valuation targets, and why my objective is never to buy at the bottom or sell at the top.

In the additional thoughts, I get into the discomfort of making rational decisions against the grain of the tribe, and what evolutionary programming has to do with it.

The full piece is at investor.fm.

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📚 Vitaliy’s books: Soul in the Game – https://amzn.to/43CF73v The Little Book of Sideways Markets – https://amzn.to/3QWTlqZ Active Value Investing – https://amzn.to/3u8zn3A

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_________________________________________________________ WHO AM I: Vitaliy Katsenelson is the CEO of Investment Management Associates (IMA) and an award-winning writer. Forbes Magazine called him “The New Benjamin Graham.” His work has appeared in the Financial Times, The Wall Street Journal, Barron’s, Fortune, Institutional Investor, and Foreign Policy. He is the author of three books, including Soul in the Game: The Art of a Meaningful Life. _________________________________________________________ Please read the following important disclosure: https://investor.fm/disclosure/

View IMA’s regulatory filings — including ADV Part 2A & 2B, Form CRS, firm brochure, conflicts of interest disclosures, sample quarterly letters, and privacy policy — at imausa.com.

The post You are not as smart as you think you are – Ep 295 appeared first on The Intellectual Investor - Value Investing by Vitaliy Katsenelson.

My dear friend Guy Spier did an almost hour-long interview with CNBC’s Becky Quick. It is an interview I wish had never happened, or, if it did, for a different reason. Guy has been diagnosed with glioblastoma (GBM), one of the deadliest cancers. In January, Guy returned money to his investors, closed his fund, and wrote a must-read letter.

I first heard of Guy at Charlie Munger’s Daily Journal meeting, when a friend pointed to his silhouette and whispered his name with a deference that made me take note. Our friendship actually began a few years later in Trani, Italy, where my brother Alex met Guy first, both of them skipping the Value Investing Seminar to wander the streets. One of the first things Guy said to me was that he envied the relationship I had with Alex. Who starts a conversation like that? Guy does. He operates on a different wavelength.

In this piece I write about what I learned watching Guy in action: his inaugural VALUEx conference in Zurich, our CFA European Tour through Frankfurt and London, Bizet’s Pearl Fishers at the Zurich Opera House with his wife Lori, and the small moments that made me want to be more like him. I also share what Guy’s letter did to my son Jonah, who interned at Aquamarine and stayed in Guy’s home, and what Guy’s diagnosis has clarified for me about kindness, borrowed time, and the obituaries we are all already living.

The full piece, along with links to Guy’s letter and the Becky Quick interview, is at investor.fm.

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🔗 LINKS MENTIONED:

Guy’s letter to his investors

The pianist Maria João Pires performing

Photos

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WHO AM I: Vitaliy Katsenelson is the CEO of Investment Management Associates (IMA) and an award-winning writer. Forbes Magazine called him “The New Benjamin Graham.” His work has appeared in the Financial Times, The Wall Street Journal, Barron’s, Fortune, Institutional Investor, and Foreign Policy. He is the author of three books, including Soul in the Game: The Art of a Meaningful Life. _________________________________________________________

Please read the following important disclosure: https://investor.fm/disclosure/

View IMA’s regulatory filings — including ADV Part 2A & 2B, Form CRS, firm brochure, conflicts of interest disclosures, sample quarterly letters, and privacy policy — at imausa.com.

The post Guy and I – Ep 294 appeared first on The Intellectual Investor - Value Investing by Vitaliy Katsenelson.

I am on the flight from Denver to San Francisco with my twelve-year-old daughter when I write this letter to IMA clients about the craziness I am seeing in the markets. The turbulence on the flight gave me the pilot analogy. The rest came from what I see in valuations.

This market is starting to feel incredibly bubbly, approaching circa 1999. The similarities are eerie. Intel and Corning, darlings of 1999, are at multidecade highs at nosebleed valuations. Walmart is trading at 50 times earnings again, the same multiple that produced no returns for shareholders from 1999 to 2014. And Nvidia, the most valuable company in the world, trades at 30 times 2026 earnings while SpaceX, Anthropic, and OpenAI prepare to go public, all losing money, collectively throwing close to a trillion dollars at AI data centers.

I walk through why the capital cycle in semiconductors looks like the railroads in 1800s Britain and telecom in 1999, what it means that Meta and Google have gone from buying back their own stock to issuing it, and why three IPOs plus two secondary offerings may put a bow on this year’s AI rally. I share why we have been trimming positions, buying smaller, and owning businesses that march to their own drummer. I quote a line from Jean-Marie Eveillard that has stayed with me since the late 90s. And I explain why our returns are likely to underperform the neighbors for the foreseeable future, and why we are not going to do anything about it.

Read the full letter at investor.fm.

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🔗 LINKS MENTIONED:

Charts

Living and Investing with Intention

Performance information

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WHO AM I: Vitaliy Katsenelson is the CEO of Investment Management Associates (IMA) and an award-winning writer. Forbes Magazine called him “The New Benjamin Graham.” His work has appeared in the Financial Times, The Wall Street Journal, Barron’s, Fortune, Institutional Investor, and Foreign Policy. He is the author of three books, including Soul in the Game: The Art of a Meaningful Life. _________________________________________________________

Please read the following important disclosure: https://investor.fm/disclosure/

View IMA’s regulatory filings — including ADV Part 2A & 2B, Form CRS, firm brochure, conflicts of interest disclosures, sample quarterly letters, and privacy policy — at imausa.com.

The post This Is Your Captain Speaking – Buckle Up – Ep 293 appeared first on The Intellectual Investor - Value Investing by Vitaliy Katsenelson.

It was 2006, my fifth year teaching a graduate investment class at the University of Colorado at Denver, and I had stopped preparing for lectures. One day I opened the syllabus and found discounted cash flow analysis on the menu. I started with: “Imagine you are a farmer about to buy a cow. How much would you pay for that cow?”

A few days later, on a Saturday morning, I was sitting in my basement working on the valuation chapter of my first book, Active Value Investing. I was stuck. Valuation can be a very dry and boring topic. After staring at a blank screen for hours, I started listening to Barbra Streisand’s “Papa, Can You Hear Me?” from Yentl on YouTube. An hour later I was deep into Fiddler on the Roof, listening to “If I Were a Rich Man.”

And then something happened.

I walk through how my subconscious melded Tevye with that cow lecture, and how I ended up writing a chapter about a Jewish farmer buying a cow named Golde, smack in the middle of a finance book filled with seventy-five charts and tables. It became my favorite chapter by a mile.

From there I get into what almost two decades of writing have taught me: why I show up for an hour or two every morning without word-count goals, why the subconscious is where the magic happens, why storytelling beats sterile facts, and why Steve Jobs was right that you can only connect the dots looking backward. Also, a quiet tribute to my Eastern European ancestors, who were not so different from Tevye.

The full essay is at investor.fm.

_________________________________________________________ 🔗 LINKS MENTIONED: Barbra Streisand’s “Papa, Can You Hear Me?” https://www.youtube.com/watch?v=QwCPAo5e_F8

Tevye was a Rich Man chapter https://investor.fm/tevye-was-a-rich-man/ _________________________________________________________ 📩 Join 100,000+ readers on Vitaliy’s FREE weekly newsletter: https://investor.fm/sign-up/

📚 Vitaliy’s books: Soul in the Game – https://amzn.to/43CF73v The Little Book of Sideways Markets – https://amzn.to/3QWTlqZ Active Value Investing – https://amzn.to/3u8zn3A

🌐 Follow Vitaliy: X/Twitter – https://x.com/vitaliyk LinkedIn – https://www.linkedin.com/in/katsenelson/ Instagram – https://www.instagram.com/vitaliyk/ Website – https://investor.fm/

_________________________________________________________ WHO AM I: Vitaliy Katsenelson is the CEO of Investment Management Associates (IMA) and an award-winning writer. Forbes Magazine called him “The New Benjamin Graham.” His work has appeared in the Financial Times, The Wall Street Journal, Barron’s, Fortune, Institutional Investor, and Foreign Policy. He is the author of three books, including Soul in the Game: The Art of a Meaningful Life. _________________________________________________________ Please read the following important disclosure: https://investor.fm/disclosure/

View IMA’s regulatory filings — including ADV Part 2A & 2B, Form CRS, firm brochure, conflicts of interest disclosures, sample quarterly letters, and privacy policy — at imausa.com.

The post Fiddler on the Roof and Value Investing – Ep 292 appeared first on The Intellectual Investor - Value Investing by Vitaliy Katsenelson.

A client emails me: stock XYZ has declined 25%, is the thesis broken? It’s a fair question, and the honest answer is one I want to walk through carefully, because the same client letter brought a second question wearing different clothes: how do you tell the difference between patience and stubbornness when a position isn’t working?

Both questions get at something I think about constantly: how to hold a position through doubt without either flinching at noise or hardening into ego. Daily liquidity in the stock market is both a feature and a bug, and most of the job of being a long-term investor is learning to take the feature without getting hurt by the bug.

I work through why I don’t try to interpret daily price movements anymore, and why trying to make sense of them is like looking for deep meaning in the poetry of inmates of an insane asylum. I talk about reading the press release and listening to the earnings call before I look at the stock price, so “the market” (a computer, a day trader in his mom’s basement, or a fund manager with braces to pay for) doesn’t tell me what to think about a company’s performance.

Then I take on the harder question. I lay out what separates patience from stubbornness, why one investor is in scientist mode and the other is engulfed by ego, and why the line between hero and anti-hero is thinner than most of us want to admit. I borrow from Soul in the Game along the way.

The full piece is at investor.fm. _________________________________________________________ 📩 Join 100,000+ readers on Vitaliy’s FREE weekly newsletter: https://investor.fm/sign-up/

📚 Vitaliy’s books: Soul in the Game – https://amzn.to/43CF73v The Little Book of Sideways Markets – https://amzn.to/3QWTlqZ Active Value Investing – https://amzn.to/3u8zn3A

🌐 Follow Vitaliy: X/Twitter – https://x.com/vitaliyk LinkedIn – https://www.linkedin.com/in/katsenelson/ Instagram – https://www.instagram.com/vitaliyk/ Website – https://investor.fm/

_________________________________________________________ WHO AM I: Vitaliy Katsenelson is the CEO of Investment Management Associates (IMA) and an award-winning writer. Forbes Magazine called him “The New Benjamin Graham.” His work has appeared in the Financial Times, The Wall Street Journal, Barron’s, Fortune, Institutional Investor, and Foreign Policy. He is the author of three books, including Soul in the Game: The Art of a Meaningful Life. _________________________________________________________ Please read the following important disclosure: https://investor.fm/disclosure/

View IMA’s regulatory filings — including ADV Part 2A & 2B, Form CRS, firm brochure, conflicts of interest disclosures, sample quarterly letters, and privacy policy — at imausa.com.

The post What to Do When a Stock Drops 25% – Ep 291 appeared first on The Intellectual Investor - Value Investing by Vitaliy Katsenelson.

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Adam Anderson’s interview – AI-generated summary: https://x.com/vitaliyk/status/2056704702323229068

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📚 Get my books:

Soul in the Game – https://amzn.to/43CF73v

The Little Book of Sideways Markets – https://amzn.to/3QWTlqZ

Active Value Investing – https://amzn.to/3u8zn3A

WHO AM I: Vitaliy Katsenelson is the CEO of Investment Management Associates (IMA) in 2012. Forbes Magazine called him “The New Benjamin Graham.” He’s written for publications including Financial Times, Barron’s, Institutional Investor, and Foreign Policy.

The post Greg Abel Takes Over Berkshire Hathaway: My Thoughts After Omaha 2026 – Ep 290 appeared first on The Intellectual Investor - Value Investing by Vitaliy Katsenelson.

How has the war in Iran changed how you think about portfolio construction? The war highlighted a deeper shift in the post-WWII order, with the US weakening its own alliances and quietly handing China and Russia the gift of a fractured West. That makes the world less predictable, raises pressure on US deficits, and means real commodities are likely to cost more over time. Our response has been to stay comfortable with our oil and gas exposure, add to gold, and look for businesses in non-Western countries where the rule of law still holds.

Is the US dollar losing its status as the world’s reserve currency? Not in a binary, one-day-to-the-next way — but in billions of small incremental decisions. Vietnam settling a trade in yuan, India buying Middle Eastern oil in local currency, China and Russia trading in their own currencies — none of it is dramatic alone, but the trend is real. The dollar’s share of foreign reserves has already fallen from 70% to 58% over two decades, and that drift is likely to accelerate.

What’s the catch in being the world’s reserve currency? Reserve status spoiled us. Foreign demand for dollars subsidized our borrowing costs and made us feel invincible and fiscally untouchable, even as we drifted from exemplary borrower to drunken sailor. Governments that can print money don’t go bankrupt in the traditional sense — they go bankrupt slowly, by paying creditors back with currency that buys fewer eggs.

How do you think about owning oil companies, especially ones outside the US? The decision isn’t really about where a company is headquartered — it’s about the business, the assets, and above all the management. Oil is brutally cyclical, and average managers tend to invest at the top and dilute shareholders at the bottom, so we hunt for the rare operators who zig when the industry zags. We stick to Western democracies like Canada and Norway, where the rule of law is solid and governments are oil-friendly because they need the tax revenue.

Why own gold if it has no cash flows? Honestly, I hate owning it — gold violates most of my past-held beliefs. But currencies are stories, and gold’s story is five thousand years old, which matters when central banks are running out of alternatives. After the US froze Russian reserves and turned the dollar into a political weapon, central banks started accumulating gold at roughly double the pace of the prior decade, and we want a small position alongside that shift.

Should I put a little money into crypto as a lottery ticket? Bitcoin may have been a lottery ticket a decade ago, but today it’s institutionalized and widely owned — it has been discovered, and lottery-like returns are unlikely from here. I won’t buy it in client accounts; I only have room for one purchase I hate, and that’s gold. If you want to own some personally, only put in what you’re willing to lose — and you don’t need us for that.

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Trump’s call for a bitcoin strategic reserve is a very bad idea article: https://investor.fm/trumps-call-for-a-bitcoin-strategic-reserve-is-a-very-bad-idea/

📚 Get my books:

Soul in the Game – https://amzn.to/43CF73v

The Little Book of Sideways Markets – https://amzn.to/3QWTlqZ

Active Value Investing – https://amzn.to/3u8zn3A

WHO AM I: Vitaliy Katsenelson is the CEO of Investment Management Associates (IMA) in 2012. Forbes Magazine called him “The New Benjamin Graham.” He’s written for publications including Financial Times, Barron’s, Institutional Investor, and Foreign Policy.

The post What the Iran War Reveals About the Dollar, Gold, and the End of US Exceptionalism – Ep 289 appeared first on The Intellectual Investor - Value Investing by Vitaliy Katsenelson.

https://traffic.libsyn.com/secure/intellectualinvestor/288_QA_Series_On_Firing_Clients_Sizing_Positions_and_Ignoring_Book_Value.mp3

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📚 Get my books:

Soul in the Game – https://amzn.to/43CF73v

The Little Book of Sideways Markets – https://amzn.to/3QWTlqZ

Active Value Investing – https://amzn.to/3u8zn3A

WHO AM I: Vitaliy Katsenelson is the CEO of Investment Management Associates (IMA) in 2012. Forbes Magazine called him “The New Benjamin Graham.” He’s written for publications including Financial Times, Barron’s, Institutional Investor, and Foreign Policy.

The post Q&A Series: On Firing Clients, Sizing Positions, and Ignoring Book Value – Ep 288 appeared first on The Intellectual Investor - Value Investing by Vitaliy Katsenelson.

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📩 Join 100,000+ readers on my FREE weekly email newsletter: https://investor.fm/sign-up/

📚 Get my books:

Soul in the Game – https://amzn.to/43CF73v

The Little Book of Sideways Markets – https://amzn.to/3QWTlqZ

Active Value Investing – https://amzn.to/3u8zn3A

WHO AM I: Vitaliy Katsenelson is the CEO of Investment Management Associates (IMA) in 2012. Forbes Magazine called him “The New Benjamin Graham.” He’s written for publications including Financial Times, Barron’s, Institutional Investor, and Foreign Policy.

The post Q&A: The Antifragile Investor: Balancing Geopolitics, Identity, and the Cost of Growth – Episode 287 appeared first on The Intellectual Investor - Value Investing by Vitaliy Katsenelson.

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📩 Join 100,000+ readers on my FREE weekly email newsletter: https://investor.fm/sign-up/

📚 Get my books:

Soul in the Game – https://amzn.to/43CF73v

The Little Book of Sideways Markets – https://amzn.to/3QWTlqZ

Active Value Investing – https://amzn.to/3u8zn3A

WHO AM I: Vitaliy Katsenelson is the CEO of Investment Management Associates (IMA) in 2012. Forbes Magazine called him “The New Benjamin Graham.” He’s written for publications including Financial Times, Barron’s, Institutional Investor, and Foreign Policy.

The post Uber and Self-Driving Cars: The Utilization Problem Nobody Talks About – Ep 286 appeared first on The Intellectual Investor - Value Investing by Vitaliy Katsenelson.