Prem Watsa

Prem Watsa was the CEO of a Canadian insurance company named Fairfax. Prem was considered an immigrant success story in Canada. He came to Toronto from India almost penniless and attended the University of Western Ontario. After his graduation he was hired by a life insurance company where he learned about investing and investment strategies and became an expert in stock-picking methodology. Although Prem wasn’t wealthy from his employment, he was well-respected and had a growing reputation in the business community. Prem and some other associates went together to purchase a small company called Markel Insurance which they changed to Fairfax. By the mid-1990s, Fairfax was one of the leaders in the North American insurance business. Its stock had risen from $70 in 1995 to over $605 in 1999.

Prem noticed that after Fairfax was listed with the NYSE in December 2002, there was an odd occurrence relative to...