Living Legends

No phony newsreel footage is necessary to convey the wisdom of two living legends who thrived through the granddaddy of them all, the Great Crash of 1929. Both Irving Kahn, the oldest active money manager on Wall Street at 103, and 106 year-old Roy Neuberger, saw the recent shakeout in global markets as just another opportunity to buy good companies cheaply while competitors a third their age rushed for the exits.

Kahn says he ignores market gyrations and typically holds stocks for at least three years, sometimes as much as 15, until value is realised. His firm, Kahn Brothers, compares its philosophy to tending an orchard with different types of fruit, some of which ripen more slowly than others. If that sounds suspiciously like the father of value investing, Benjamin Graham, it is no accident – Kahn was Graham’s first teaching assistant and helped him with his 1934 classic Security Analysis. Like Graham, Kahn seeks out unloved and obscure stocks, eschewing highfliers.

“Never buy popular stocks, except maybe in a depression,” he warns.

Neuberger, and the firm he founded, Neuberger Berman, hew to similar principles. He retired at age 99 and is now too frail to be interviewed. His 68-year-old protégé Marvin Schwartz, who joined the firm in 1961, consults with him regularly though and credits Neuberger with providing appropriate perspective in hard times such as these.

“In almost each and every instance, he advised us to buy in what would be a passing negative period,” says Schwartz.

Shareholders of Berkshire Hathaway hoping that the 79-year-old Oracle of Omaha will achieve longevity on par with Messrs Kahn and Neuberger have cause for cheer. Optimistic value-seekers have remarkable staying-power. Philip Carret and Philip Fisher, two of Buffett’s key influences aside from Graham and among the most successful investors of all-time, died at age 101 and 96, respectively. Another legendary investor, Sir John Templeton, remained active until his death last summer at age 95 and is credited with two of the great contrarian investing quotes: “Invest at the point of maximum pessimism” and “the four most dangerous words in investing are ‘it’s different this time.’”

[via iluvbabyb]