"Google would find the fund management market more difficult than it thinks. There are significant barriers to entry and it's not something you could get into overnight."
"There probably is a subsection of investors who would have confidence in Google, but I think the vast majority of investors want a relationship with an entity which can supply them with high quality information, market knowledge and a view on that market. I think it is unlikely they would turn to Google for those qualities."
"...the global wealth management and asset allocation paradigm is fundamentally broken. Or rather it's a model that is past its sell-by date and is increasingly failing its ultimate customers. The "conventional wisdom" has disconnected from its "source code" meaning that the industry has forgotten the original reasons why things were initially done in a certain way and these practices have simply taken on quasi-mystical status, above questioning...which means that the system is unable and unwilling to adapt to fundamentally changed conditions (technological, economic, financial, cultural, demographic)."And so opportunities (to take a step back and do things differently) abound. Coming back to the "broken asset allocation paradigm" – the constraints (real, i.e. regulatory and imagined, i.e. convention) and processes around traditional asset management and allocation (across the spectrum of asset classes) now mean that it is almost impossible to do anything but offer mediocre products and returns if operating from within the mainstream framework. (Indeed the rise and rise of low cost ETF / passive products is testimony to this – if you can't do anything clever, at least minimise the costs as much as possible.) The real opportunities arise when you have an unconstrained approach – when the only thing driving investment decisions is, well, analysis of investment opportunities – irrespective of what they may be, how they may be structured, and how many boxes in some cover-my-ass due diligence list they may tick (or not)."
Daily checklist:8am – 10am: Read trade journals and regional newspapers for ideas on companies with 1) new products, 2) new regulation, 3) restructurings, 4) expansions, 5) context for investment ideas10am – 6pm: Find new ideas. Read 1) company announcements. 2) annual reports from A-Z or 3) annual reports of companies screened for buybacks / insider buying / dividend omission, etc.7pm – 10pm: Read books to understand the world / improve forecasts / fine tune investment processBefore each investment:
- What do you think will happen to the company and by consequence the stock price?
- Go through a personal investment checklist
- Use someone else or yourself as a devil's advocate to disprove your own investment theses
- Have we reached "peak negativity" / has narrative played out?
- Are fundamentals improving?
- Why is it cheap? Especially if it screens well in the eyes of other investors – i.e. exciting story, other investors, low P/E, etc.Decide what will be needed for you to admit defeat / sell the positionIf you lose focus, sell all the positions, take a break and start again.Only expose yourself to serious and intelligent people on Twitter / investor letters / media and avoid the noise that other investors expose themselves to...