Walter Schloss may not be known outside value investing circles, but his investing track record is something to pay attention too. And now with the various internet sources, we can put together his limited interviews and writings together “under one roof”. Walter Schloss is special as he is one of the few individuals that we know of that has a direct link to Benjamin Graham. He was highlighted in the Superinvestors of Graham and Doddsville and this is what Warren Buffett had to say about him.
Walter has diversified enormously, owning well over 100 stocks currently. He knows how to identify securities that sell at considerably less than their value to a private owner. And that’s all he does. He doesn’t worry about whether it it’s January, he doesn’t worry about whether it’s Monday, he doesn’t worry about whether it’s an election year. He simply says, if a business is worth a dollar and I can buy it for 40 cents, something good may happen to me. And he does it over and over and over again. He owns many more stocks than I do — and is far less interested in the underlying nature of the business; I don’t seem to have very much influence on Walter. That’s one of his strengths; no one has much influence on him.
Adam Smith also featured Walter Schloss in Supermoney (1972):
He has no connections or access to useful information. Practically no one in Wall Street knows him and he is not fed any ideas. He looks up the numbers in the manuals and sends for the annual reports, and that’s about it.
In introducing me to (Schloss) Warren had also, to my mind, described himself. “He never forgets that he is handling other people’s money, and this reinforces his normal strong aversion to loss.” He has total integrity and a realistic picture of himself. Money is real to him and stocks are real — and from this flows an attraction to the “margin of safety” principle.
Schloss was known for being very frugal. His total office expense was an estimated $11,000 while his partnership generated a net profit of $19,000,000. According to a Forbes interview he did in 2008, by Walter’s account he averaged a 16% total return after fees during five decades as a stand-alone investment manager, versus 10% for the S&P 500. For a more historical record, we can look at the record of WJS LTD. Partners which is highlighted in the Superinvestors of Graham and Doddsville.
How did Walter Schloss achieve this magnificent record?
When Walter and Edwin (Walter Schloss’s son, who joined Walter in running the partnership) were asked in 1989 by Outstanding Investors Digest, “How would you summarize your approach?” Edwin replied, “We try to buy stocks cheap.”
Walter Schloss on Investing and Interviews
- Why We Invest the Way We Do
- NYSAA Value Investing Archive Dedication: Walter Schloss
- The Money Men: Making Money Out of Junk
- Forbes: Experience
- Barrons 1985: The Right Stuff
- Factors needed to make money in the stock market
- Walter Schloss: The Dow Jones Industrial Average Amended
- The Hippocratic method in Security Analysis
- Criteria for liquidations where money is held by company
- 1993 Value Investing Seminar
- Walter Schloss on Benjamin Graham
- Going out on top: Walter and Edwin Schloss
- 65 Years on Wall Street
- Walter Schloss: Essense of Value Investing
- Walter Schloss list of stocks
- In Defense of Stock Dividends
- On intrinsic value
- Walter Schloss: Searching for Value
- Overvaluation of
Walter Schloss Books
- Value Investing: From Graham to Buffett and Beyond
- The Memoirs of Walter J. Schloss : A Personal and Family History
{ 0 comments… add one now }