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On Stocks, Expectations, And The Pursuit Of Happiness
Tue, Oct. 21 • 1 Comment
- Happiness is more about expectations than it is about results.
- The impact of short-term expectations on moment-to-moment human happiness has been highlighted by researchers who believe they have found the key to happiness, or at least “momentary subjective well-being”.
- A subject’s happiness was not explained by the current pay-off, “but by the combined influence of recent reward expectations and predictions errors arising from those expectations”.
- As value investors, it is our job to look for instances where the market sets a low EV current price on what is ultimately a stock that surprises to the upside.
- We view it as our job to try to both counter short-termism in ourselves and exploit overly-depressed expectations in the market.
Being Intelligent About Smart Beta
Fri, Jul. 18 • 4 Comments
- It is argued by proponents of Smart Beta that this allows investors to take advantage of “anoma-lies” in markets wherein certain companies outperform over certain periods and in certain conditions.
- The only two aspects of Smart Beta which are truly “new” are the term itself and the use of a low-cost ETF vehicle to deliver it.
- While we are fans of being selective about stocks and fees, as active managers we do not believe Smart Beta will consistently live up to the promise in its name.
The Devolution Of Diversification
- Proper portfolio diversification can be achieved with relatively few holdings.
- Individual companies are more global and, therefore, more diversified in their operations.
- Piling over-diversified active equity managers upon one another is an expensive, complex, and time-consuming proposition that is detrimental to returns.
- Backtesting Value Investing Over The Last 10 Years: What Worked... And What Didn't
Pennies From Heaven And Investor Irrationality: When Bad News Is Good News
Jul. 30, 2013 • 5 Comments
Why The Fed Balance Sheet Matters
Apr. 30, 2013 • 21 Comments
- 'World War C': Neosho Capital On The Currency War
The Federal Reserve: Picking Up Nickels
Oct. 25, 2012 • 7 Comments
- Risk-On/Risk-Off And Blackjack: Why RORO Is Always Doomed To Fail
- Neosho Capital: The Ongoing Eurozone Debt And 'Risk-Free Rate'
The European Debt Crisis: A Symptom Of A Chronic Illness And The Nature Of The Beast
Jan. 27, 2012 • 2 Comments