Episode 9: Integrated Research, Xref and Mailbag

There’s an old (and quite unscientific) investment principle called the ‘rule of five‘ which states that for every five stocks in your portfolio, one will significantly outperform the market, three will more or less match it, and one will…well, it’ll suck. Badly. Overall, that makes the whole business of portfolio management seem rather futile. If the end result is pretty much a wash, […]

When people talk about capital, they tend to mean stuff: factories, patents, cash, code. Things you can count, stick in a spreadsheet, and list on a balance sheet. But that misses the point. The real magic of capital isn’t in the owning. It’s in the doing. Hernando de Soto, the Peruvian economist and author, put it brilliantly in The Mystery […]

You might have heard the tale about the fund manager with a quirky hiring practice. Each time he needed a new analyst, he’d begin by taking half the resumes and — without even a glance — tossing them straight in the bin. His rationale? “I don’t hire unlucky people.” Now, while this story is almost certainly apocryphal, there’s a twisted […]

Between 2019 and 2020 Warren Buffett’s Berkshire Hathaway (NYSE:BRK) underperformed the S&P500 by 37%. It was one of the poorer periods of relative performance for the Oracle of Omaha, who was “burdened” with loads of cash and missed out on a lot of the boom in technology stocks. As you can see, Buffett regularly lags the broader index. And sometimes […]

This week was the 10th anniversary of the collapse of US investment bank Lehman Brothers, the event that’s seen as precipitating the Global Financial Crisis. The milestone has many in the media questioning the current bull market, one that is starting to get rather long in the tooth and is showing more than a few red flags. In fact, parallels […]

Everyone loves a good stock chart. Up and to the right, all green candles and glory! But that is rarely how things play out in the real world, at least not over any meaningful time frame. What the latest research from Michael Mauboussin and Dan Callahan makes painfully clear is this: if you are aiming for outsized returns, you will […]

In a 2014 interview, Lloyd Blankfein, then CEO of Goldman Sachs and part-time Bond villain lookalike, was asked a simple question: How far into the future can you see? Now, given Goldman’s reputation for spotting market trends before most, you’d expect a confident answer.  Instead, Blankfein deadpanned: “I don’t think I could see four inches into the future.” Not exactly […]