The 100 Year Thinkers · Oct 9, 2026 · 1h 14m · 52m saved
With Chris Davis, Chairman and Portfolio Manager of Davis Funds · Robert Hagstrom, CIO of EquityCompass and author of The Warren Buffett Way
In 2001 Naspers, a South African family-run company, put $32 million into Tencent for 46% of it, and Chris Davis said that stake grew to $235 billion.
Both guests said the costliest mistake with a great business is selling it. Both also cap any single stock at 10% of a portfolio, because the people whose money they run may not sit through a 50% fall.
"The big money is not in the buying and the selling, it's in the waiting." — Chris Davis, quoting Charlie Munger
Chris Davis, chairman of Davis Funds and a director of Berkshire Hathaway, has managed the firm's flagship funds since 1995. Robert Hagstrom, CIO of EquityCompass, wrote his dissertation on Warren Buffett and trained under Bill Miller. They spoke together on The 100 Year Thinkers, part of the Excess Returns podcast network.
The full episode is covered here so you can skip it. 74 minutes of audio, 22 minutes of reading.
Here are the 16 lessons that matter.
Key Takeaways
The only thing that goes wrong after buying a great business is selling it, Davis said
Both managers cap a position at 10%, though Davis said he would have no limit in a personal account
Davis Funds moved its limit up from 5%, which he called nearly 100 years of trust-bank convention
Naspers' $32 million Tencent stake grew to $235 billion with no position limit in the way
The index has become a very large momentum fund, and Davis fears venture capitalists will use it as their exit
Davis sold Costco after its multiple doubled, and his estimates for store count, private label and overseas growth all proved too low
Two stocks with identical earnings and multiples can return very different amounts, depending on what the growth cost
AI spending may peak in 2027, Hagstrom said, after which the hyperscalers could turn back into cash generators
If four or five cloud providers compete with low switching costs, AI's value goes to the users, not the builders
Davis called Amazon's move into advertising a terrible mistake, while conceding the business is "literally printing money"
1. Miller's Record Held Up
A host opened by asking Davis to say something kind about Hagstrom's books. Davis used the chance to defend Bill Miller, the Legg Mason manager Hagstrom studied and wrote about early in his career.
Davis said the public never saw how right Hagstrom's view of Miller turned out to be
The financial crisis and Legg Mason's decision to replace Miller as manager left the impression that his run had ended. Davis said it had not.
"It was one of the great investment records, even including the dip, which everybody thought was the ending, but it wasn't." — Chris Davis
Hagstrom said someone once told him that, having written his dissertation on Warren Buffett and done his practical training with Miller, he had no excuse for failing to beat the market.
"It may be more, it's more pressure than I think I want sometimes." — Robert Hagstrom
