Warren Buffett gets most of the attention from the financial media, but investors should also learn from his long-time friend and business partner Charlie Munger when going on the hunt for value investments.
Charlie Munger, Warren Buffett’s right-hand man, is all about buying shares of wonderful businesses at discounts to their estimate of intrinsic value and holding onto them for the long term. The man played a major role in shaping Warren Buffett’s investment style, pushing him from “cigar-butt investing” to only owning shares of “wonderful” businesses.
These days, it’s much harder to find “wonderful businesses” at sizeable discounts to their intrinsic value. Price-to-earnings (P/E) multiples are on the higher end, and even Charlie Munger himself hinted at a lack of bargains to be had in today’s frothy market. Like it or not, Munger and Buffett will continue investing, even though they think market returns over the decade ahead will be lower than that of the past decade.
Don’t neglect the valuation process
Value has never been more important. While it may not seem this way, given the speculative frenzy in Bitcoin and all the sort, investors must continue to weigh the risk with reward to ensure they’re not at risk of skating offside come the next correction. The next pullback is always waiting around the corner, and it’s the names that have climbed the highest in a market rally that tend to face a proportional magnitude of volatility in the opposite direction. As someone wise once put it, the higher you climb, the farther you have to fall.
That’s not to say you should shun growth and frothy momentum stocks, though. If a firm’s growth profile justifies its premium price tag, an unprofitable but growth business’s stock could very well trade at north of 20 times and still be considered a great value.
Shopify: It’s too expensive to be a value stock … right?
Look no further than shares of Shopify(TSX:SHOP)(NYSE:SHOP), a stock that’s never traded at a valuation multiple that’s anything short of stupidly expensive. Even during the depths of the February-March market crash, SHOP shares were still not cheap through the eyes of value investors who failed to grasp the full understanding of Shopify’s incredible growth story. Indeed, Shopify trading at 20 times sales turned out to be a bargain when you weigh how much shares cost today (shares of Shopify currently command a staggering 60 times sales)!
Of course, Shopify deserved to be re-valued to the upside, because of its pandemic tailwinds and because the low-rate environment calls for slightly higher-than-average multiples. Bonds are the most unrewarding and the “expensive” they’ve been in recent memory, after all.
Back to Charlie Munger. He’s a value man. But it’s not just the discovery and purchase of bargains that he should be known for. I think the man’s patience is admirable. In an era of commission-free trading (it’s not yet in Canada), the definition of long term has undoubtedly shrunk from the time when Charlie Munger began his investment career.
What is long term these days?
Depending on who you ask, long term could be anywhere from six months to a year and a half. That’s not Charlie Munger’s definition of long term, though!
He’ll gladly sit on a stock for years, if not decades at a time, as shares correct upwards towards his estimate of its intrinsic value. Moreover, Charlie Munger’s insistence on “wonderful businesses” over cigar butts also pays massive dividends over the long haul, because once a mispriced stock has corrected to reflect its true intrinsic value, it can still keep building upon its intrinsic value over time. That means the said stock can be held for decades at a time.
Charlie Munger is all about sit-on-your-bum investing, a strategy that I believe can help everyday investors do far better than the market averages over time.
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One little-known Canadian IPO has doubled in value in a matter of months, and renowned Canadian stock picker Iain Butler sees a potential millionaire-maker in waiting… Because he thinks this fast-growing company looks a lot like Shopify, a stock Iain officially recommended 3 years ago – before it skyrocketed by 1,211%! Iain and his team just published a detailed report on this tiny TSX stock. Find out how you can access the NEXT Shopify today!
TORONTO – Canada’s main stock index was up more than 250 points in late-morning trading, led by strength in the base metal and technology sectors, while U.S. stock markets also charged higher.
The S&P/TSX composite index was up 254.62 points at 23,847.22.
In New York, the Dow Jones industrial average was up 432.77 points at 41,935.87. The S&P 500 index was up 96.38 points at 5,714.64, while the Nasdaq composite was up 486.12 points at 18,059.42.
The Canadian dollar traded for 73.68 cents US compared with 73.58 cents US on Thursday.
The November crude oil contract was up 89 cents at US$70.77 per barrel and the October natural gas contract was down a penny at US2.27 per mmBTU.
The December gold contract was up US$9.40 at US$2,608.00 an ounce and the December copper contract was up four cents at US$4.33 a pound.
This report by The Canadian Press was first published Sept. 19, 2024.
Losing a loved one is never easy, and the legal steps that follow can add even more stress to an already difficult time.
For years, families in Vancouver (and Canada in general) have struggled with a complex probate process—filled with paperwork and legal challenges.
Thankfully, recent changes to Canada’s probate laws aim to make this process simpler and easier to navigate.
Let’s unearth how these updates can simplify the process for you and your family.
What is probate?
Probate might sound complicated, but it’s simply the legal process of settling someone’s estate after death.
Here’s how it works.
Validating the will. The court checks if the will is legal and valid.
Appointing an executor. If named in the will, the executor manages the estate. If not, the court appoints someone.
Settling debts and taxes. The executor (and you) pays debts and taxes before anything can be given.
Distributing the estate. Once everything is settled, the executor distributes the remaining assets according to the will or legal rules.
Probate ensures everything is done by the book, giving you peace of mind during a difficult time.
Recent Changes in Canadian Probate Laws
Several updates to probate law in the country are making the process smoother for you and your family.
Here’s a closer look at the fundamental changes that are making a real difference.
1) Virtual witnessing of wills
Now permanent in many provinces, including British Columbia, wills can be signed and witnessed remotely through video calls.
Such a change makes estate planning more accessible, especially for those in remote areas or with limited mobility.
2) Simplified process for small estates
Smaller estates, like those under 25,000 CAD in BC, now have a faster, simplified probate process.
Fewer forms and legal steps mean less hassle for families handling modest estates.
3) Substantial compliance for wills
Courts can now approve wills with minor errors if they reflect the person’s true intentions.
This update prevents unnecessary legal challenges and ensures the deceased’s wishes are respected.
These changes help make probate less stressful and more efficient for you and other families across Canada.
The Probate Process and You: The Role of a Probate Lawyer
(Image: Freepik.com)
Working with a probate lawyer in Vancouver can significantly simplify the probate process, especially given the city’s complex legal landscape.
Here’s how they can help.
Navigating the legal process
Probate lawyers ensure all legal steps are followed, preventing costly mistakes and ensuring the estate is managed properly.
Handling paperwork and deadlines
They manage all the paperwork and court deadlines, taking the burden off of you during this difficult time.
Resolving disputes
If conflicts arise, probate lawyers resolve them, avoiding legal battles.
Providing you peace of mind
With a probate lawyer’s expertise, you can trust that the estate is being handled efficiently and according to the law.
With a skilled probate lawyer, you can ensure the entire process is smooth and stress-free.
Why These Changes Matter
The updates to probate law make a big difference for Canadian families. Here’s why.
Less stress for you. Simplified processes mean you can focus on grieving, not paperwork.
Faster estate settlements. Estates are settled more quickly, so beneficiaries don’t face long delays.
Fewer disputes. Courts can now honor will with minor errors, reducing family conflicts.
Accessible for everyone. Virtual witnessing and easier rules for small estates make probate more accessible for everyone, no matter where you live.
With these changes, probate becomes smoother and more manageable for you and your family.
How to Prepare for the Probate Process
Even with the recent changes, being prepared makes probate smoother. Here are a few steps to help you prepare.
Create a will. Ensure a valid will is in place to avoid complications.
Choose an executor. Pick someone responsible for managing the estate and discuss their role with them.
Organize documents. Keep key financial and legal documents in one place for easy access.
Talk to your family. Have open conversations with your family to prevent future misunderstandings.
Get legal advice. Consult with a probate lawyer to ensure everything is legally sound and up-to-date.
These simple steps make the probate process easier for everyone involved.
Wrapping Up: Making Probate Easier in Vancouver
Recent updates in probate law are simplifying the process for families, from virtual witnessing to easier estate rules. These reforms are designed to ease the burden, helping you focus on what matters—grieving and respecting your dead loved ones’ final wishes.
Despite these changes, it’s best to consult a probate lawyer to ensure you can manage everything properly. Remember, they’re here to help you during this difficult time.
TORONTO – Canada’s main stock index was higher in late-morning trading, helped by strength in energy stocks, while U.S. stock markets also moved up.
The S&P/TSX composite index was up 34.91 points at 23,736.98.
In New York, the Dow Jones industrial average was up 178.05 points at 41,800.13. The S&P 500 index was up 28.38 points at 5,661.47, while the Nasdaq composite was up 133.17 points at 17,725.30.
The Canadian dollar traded for 73.56 cents US compared with 73.57 cents US on Monday.
The November crude oil contract was up 68 cents at US$69.70 per barrel and the October natural gas contract was up three cents at US$2.40 per mmBTU.
The December gold contract was down US$7.80 at US$2,601.10 an ounce and the December copper contract was up a penny at US$4.28 a pound.
This report by The Canadian Press was first published Sept. 17, 2024.
