Vinny Catalano

Sectors in the Thematic Spotlight

I'm puzzled, Uncle Bill. Isn't it better to first know what someone has said, the logic that went into what was said, and how those ideas performed before deciding on how good someone might be based on the incomplete nature of an individual blog posting? And wouldn't that then give you sufficient information and knowledge to evaluate the current comments made and how what is currently being said fits into a consistent yet evolving view?

If so, then go to my blog and read my prior postings THEN read the current ones. If not, that's cool - I'm not your guy.

Sectors in the Thematic Spotlight

I appreciate your comments, Uncle Bill. Here are a few thoughts for you to consider:

To begin, no one commentary is all-inclusive. Unless it is an extensive research report, brief comments such as this one should be part of an ongoing dialogue. Therefore, to understand a point of view re any complex subject, requires that a person take the time to understand the methodology used and conclusions reached by reading most of the prior comments. Otherwise, the ideas and opinions are little more than in the moment, hot ideas that lack context and meaning.

As for the specifics of the commentary you refer to, the main thrust of the piece is to rebut the steady, seemingly unrelenting current media diet of macro news, which is both yesterday’s and, as it relates to GM, irrelevant, and to point out that it is time to focus on the micro areas, the sectors, of the market and the economy. It was also a comment on the thematic nature of the performance of the various sectors. Thematic analysis is a central part of my core investment strategy, whereas most investors do not invest based on themes. The point in this commentary was to bring to the attention of investors that themes matter and can help identify what to buy, what to avoid, and why.

Now, if you are able and interested in taking the time to go to my blog, you will see that I have stated very specific opinions about most of the sectors I note in this commentary. For example, the toxic areas – Financials and Consumer Discretionary – have been written about numerous times. As has the favored areas of Industrials and Info Tech. I have also written extensively on the underlying macro forces affecting all sectors.

Overall, I am trying to describe a core investment principle that most professional investors know, yet few individual investors seem to understand – the mosaic approach. To understand this principle, please visit my blog entry on the Blind Men and the Elephant:

tinyurl.com/ytxgf4

Hope this helps.