Peter Cundill passed away in January 2011 at age 77. A biography was written about him, called There’s Always Something to Do: The Peter Cundill Investment Approach. It was completed while Cundill was still alive, but arrived in the library after his death. I just finished reading it (I had to wait my turn for the only copy) and I thoroughly enjoyed it. I found the title to be ironic, however.
I am personally partial to the value style of investing. It matches my upbringing and training, and it’s familiar to me. I also appreciate the idea that investing is like a puzzle and work in research will be repaid with profits in the stock market. The many anecdotes, of successes and failures, were fascinating.
I immediately noticed two characteristics which seem to account for success. First, Peter Cundill’s heritage was described, and he came from a family who, after they immigrated from Britain to Canada, were entrepreneurial and amassed great wealth. The fortune was lost while Cundill was young, but it is very apparent that he benefited from connections. He was able to begin work with people who were well placed to mentor him and provide him with opportunity. He also had an ability to form a network of people who gave each other mutual help in their work. This is a phenomenon that I have heard and read about, but which I don’t yet understand myself. I believe it’s one of the main advantages that influential people have, which they probably learn in their families.
Second, Cundill continually preached patience. Many of the companies in which he invested took two years or longer, during which the share price sometimes continued to fall, before his decision was vindicated and his investment turned profitable. Given the repeated exhortation to patience, the title may mislead. In life, unlike in investing, there’s always something to do. Cundill was a man who was curious and had many interests. When he wasn’t engaged in investment research, he ran, he exercised, he attended museums, ballets and operas and he read voraciously. But as the investment anecdotes showed, especially in the case of selling the Japanese market short during the mid-1980s, sometimes there’s nothing to do but wait for the market to realize its mistake and adjust prices.
As the biographer pointed out, Cundill paraphrased John Maynard Kaynes’ well-known adage: “Markets can remain irrational a lot longer than you and I can remain solvent.” So I would say that in investing, there is always something to do, if you count patiently waiting for the market to realize its error as doing something.