The Financial Times has posted a lengthy two-part interview with Professor Bruce Greenwald of Columbia Business School. Prof. Greenwald’s comments regarding value traps such as Freddie/Fannie, the risks of short selling, and the importance of balance sheet analysis are particularly interesting.
Professor Greenwald also states that the “truly compelling opportunities” that existed at the market lows are gone. However, he is quick to add that there are still companies that are selling at good values from a historical perspective.
Here are links to the two-part video series along with a summary of each segment courtesy of FT.com.
Part 1: In the latest Future of Investing video, John Authers, FT investment editor, speaks to Bruce Greenwald of Columbia Business School and First Eagle Funds. They discuss why the theory of value investing devised originally in the 1930s still has power, showing how “cheap, ugly and overlooked” stocks are systematically undervalued due to “irrational” financial behavior.
Click on this link for Part 1 of the interview.
Part 2: In the second part of the interview, Mr. Authers and Prof. Greenwald discuss the lack of compelling investment opportunities for value investors, the dangers of shorting and why you should always check the balance sheet.
Click on this link for Part 2 of the interview.
For another video of Bruce Greenwald posted on this site recently, click on this link.