Mohnish Pabrai is a highly respected investor in the value investing community known for his impressive track record and investment philosophy inspired by the legendary Warren Buffett.
Pabrai’s portfolio has consistently outperformed the market, with an annualised return of over 25% since inception.
Pabrai was born in Mumbai, India, in 1964, and grew up in a middle-class family. He earned a degree in mechanical engineering from the Indian Institute of Technology (IIT).
He later obtained a master’s degree in business administration from the Haas School of Business at the University of California, Berkeley.
Pabrai started his career as a software engineer but eventually became interested in the stock market and investing.
He founded his investment firm, Pabrai Investment Funds, in 1999, with the goal of following Warren Buffett’s investment philosophy of finding undervalued companies with strong fundamentals.
Pabrai’s investment style is based on his belief in finding companies with a durable competitive advantage and a strong moat.
He also emphasises the importance of focusing on a few high-quality investments and maintaining a long-term investment horizon.
Pabrai’s approach involves deep research and analysis of a company’s financial statements, management team, and industry trends.
One of Pabrai’s most significant investment successes was his investment in the auto parts retailer, AutoZone. In 1999, he invested $650,000 in the company, which grew to $25 million by 2007.
Pabrai’s investment in this company alone contributed significantly to the growth of his investment fund.
Pabrai has been running a concentrated portfolio with a small number of stocks for a few reasons.
First, Pabrai believes in investing in his best ideas and has a high conviction in the companies he chooses to invest in.
This concentrated approach allows him to focus his research efforts on a few companies and make more significant bets on the companies he has the most confidence.
Second, Pabrai’s investment style is based on the concept of a “circle of competence.” He prefers to invest in companies he understands well and can evaluate accurately.
By limiting his investments to a few companies, he can maintain a deep understanding of each of them and remain within his circle of competence.
Finally, Pabrai’s portfolio management approach is consistent with his long-term investment horizon.
He is not interested in short-term market fluctuations and instead focuses on the long-term potential of the companies he invests in.
By keeping his portfolio concentrated, Pabrai can better ride out market fluctuations and remain invested in his chosen companies for the long term.
Mohnish Pabrai’s share portfolio
Mohnish Pabrai only owns three companies – Micron Technology, Brookfield, and Seritage Growth Properties.
|MU – Micron Technology Inc.
|BN – Brookfield Corp.
|SRG – Seritage Growth Properties