Thursday, 17 March 2011

Book Review: Peter Cundill

There's Always Something to Do: The Peter Cundill Investment Approach
Up until his death at the end of January 2011, I had not come across Peter Cundill, the Canadian value-based investor in the ilk of Benjamin Graham.

Cundill set up and ran the Cundill Value Fund, which sought out under-valued global opportunities, and generated an IRR of 15% over a 33 year-period to 2007. This has a nice resonance with my target objective of a long-term IRR of 15%. 

Cundill kept detailed diaries and Christopher Risso-Gill, a former director of the Fund, has read, analysed and interpreted them, resulting in this book, which acts an interesting chronological journey though Cundill's investing life.

The Things I Took Away

1. All roads lead to (from) Yorkshire! Cundill could trace his family roots back to 1860s Yorkshire and first worked on the Yorkshire Trust Company, which had been set up with original Yorkshire wealth;

2. "Always change a winning game" - businesses (and investment opportunities) need to be dynamic and constantly working to maintain their competitive advantages;

3. "The art of making money is not to lose it". Which is very similar to Buffett's two rules;

4. "Buy a dollar for 40 cents". Margin of safety and all that;

5. When to buy: lots of things to evaluate (eg price below book value, Net Nets etc), but consider whether the share price is less than 50% off its all-time high. This is something that I have started to factor in;

6. When to sell: sell half of any position when it has doubled;

7. "The most important attribute for success in value investing is patience, patience and more patience. The majority of investors do not possess this characteristic"


Whilst there is a not a huge amount of new theory for disciples of Graham (and to a lesser extent Buffett or other value investors), the book provides an interesting and enjoyable summary of one man's successful investing life through his own personal diaries.

There are plenty of anecdotes, case studies and things to think about, which might just provide an objective tonic of sanity in today's volatile markets. I think I shall have patience, patience and more patience ringing in my ears for the rest of my investing days.


  1. Haven't read it yet, but do have a copy and intending to. Really don't like the sound of the sell half when anything doubles rule. Smacks of uncertainty. Either a company is worth having in your portfolio or not. Shouldn't depend on arbitrary price rules - why not buy when anything halves? (though I started out planning to sell when I'd made 50%).

  2. Hi Richard

    I haven't got my copy to hand but from memory, he got caught out by taking profits at the wrong time, and therefore came up with this objective rule.

    I think there is some logic there in sofaras if something doubles and you sell 50%, you've covered your base cost and everything else represents pure profit.

    I would perhaps tinker with the rule to add some perspective of time in via a look at the IRR. For instance, I have some holdings that have doubled in value but have taken 3-4 years to do so, generating IRRs of 25-35%, which I'm perfectly happy with. I'm aiming for an IRR of 15% across my whole portfolio (for the rest of my investing life!), so it probably does make sense to lock-in returns from time to time.