Fat pitches offer a way to big riches – ask Allan Gray  

In researching my “How To Invest Like Warren Buffett” book, I was introduced to what the Oracle of Omaha describes as the fat pitch. Using an analogy from baseball, Buffett says a few times in every investor’s life, an opportunity will arise to proverbially hit the ball out the park. Fat pitches arrive unexpectedly. To be ready for them requires homework.

We were provided a recent example on Thursday’s Rational Radio, when Allan Gray director Duncan Artus shared how he made clients a quick 30% in three months. Soon after the March unbundling from Naspers, the firm bought bucketloads of MultiChoice shares from dumping foreigners at between R90 and R100.

So strong was its buying, that Allan Gray is now MultiChoice’s second biggest shareholder. On Friday, the share closed at a new high of R134.50. Artus and Co had done their homework, and were bold enough to take advantage. There’s a powerful lesson in that for all of us.

The only way to take advantage is by preparing for such opportunities by doing your homework. And when the fat pitch arrives, have the boldness to swing hard. While closing your ears to unprepared naysayers who, through their ignorance, will always miss out.