If there were ever any doubts that Gayner’s investing methods closely mirror those of Warren Buffett, the above statements should go a long way toward removing them. Like Buffett, Gayner focuses on finding steady businesses that Markel Corporation (NYSE:MKL) can hold indefinitely.
As a result, it not only pays to listen to what Gayner says, but also to note the stocks in which he sees value; according to my Foolish colleague Jessica Alling, Gayner has recently built positions in stocks involved in the energy sector, including Alpha Natural Resources, Inc. (NYSE:ANR), Arch Coal Inc (NYSE:ACI), and Peabody Energy Corporation (NYSE:BTU). Given Gayner’s proven, methodical decision-making process, these coal producers might be worth a look.
On cash as a necessary evil
“It’s a pathetic investment, with the yields you’re not making, and it’s subject to ongoing depreciation each and every day. [However], I’m willing to give up some current investment return in order to have options that cash carries with it.”
As safe as cash may seem, Gayner’s absolutely correct in describing it as a “pathetic investment,” prone to the relentless value destroying effects of inflation. Going further, Gayner reminds us that to hold too much cash is to sacrifice returns from the wide array of superior investments that exist in the stock market.
However, Gayner also recognizes cash brings with it the flexibility to act quickly when good investment opportunities arise.
With this in mind, despite his distaste for cash, and as I suggested last month, Gayner appears to have plenty of options on the table considering the fact he’s currently “tactically building” Markel Corporation (NYSE:MKL)’s cash position. Investors would be wise, then, to keep an eye on how Gayner chooses to deploy that cash in the coming quarters.
The article 5 Key Quotes from Markel’s President and CIO originally appeared on Fool.com and is written by Steve Symington.
Fool contributor Steve Symington owns shares of Markel. The Motley Fool recommends Berkshire Hathaway and Markel. The Motley Fool owns shares of Berkshire Hathaway and Markel.
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