In his latest letter to investors, Mohnish Pabrai warned about the perils of buying stocks at high prices. He explained that it's possible to overpay for even the market's most promising companies. Giving Microsoft as an example, Pabrai noted:
Q2 2020 hedge fund letters, conferences and more
"Microsoft had a very strong entrenched monopoly position in most of its markets. It continued to do well after 2000. In fact, its earnings went from $8 billion in 1999 to over $43 billion recently. Unfortunately, as I had predicted, the stock was a dud. From 1999 to 2016, the stock delivered zero returns. It was at $59 a share in 1999 and $59 a share in 2016. But that wasn't the...
