Portfolio Roundup

I continue to hold a handful of positions-- five, to be precise. I believe these positions are significantly undervalued and provide large upside.

1. The largest position I hold is Bank of America (BAC). As the legacy asset servicing dwindles down and litigation expenses come down-- they have to some day; the true earning potential of this giant bank will be evident. I believe that the intrinsic value of this bank is somewhere in the mid 20s.
2. The other large position is own is Markel Insurance (MKL). I view this as a core position that I add to as opportunities present themselves. In 2013 I was able to add significantly to this position in October.
3. Another core position I am slowly building is Fairfax Financial (FFH). This business is quite similar to Markel and is run by a long term oriented able management. Fairfax hasn't had a good 2013 as they were quite bearish and hedged all their investment gains going into the year. I believe they are currently quite undervalued but as the market runs up, they may get even cheaper.
4. The only new position I started in 2013, was Fortress Paper (FTP). This is a hidden asset play that I posted about. It is hard to estimate intrinsic value of this business because of a number of unknowns at this point. This uncertainty and a string of bad luck has caused this stock to drop to all time lows, while the book value stayed quite stable.
5. The last position worth mentioning is cash. This position isn't due to some top-down call, but due to lack of new ideas and maturing of older ideas. This position earns barely anything in the money market, but provides large optionality if and when the markets present opportunities in the future.