Value Investors Struggle – What Happened?csinvesting
IWY “Value” shares (Brown line) vs. IWF “Growth” shares
What is going on? https://www.threepartadvisors.com/audio
Active Managers Horizon Kinetics Worth a careful read. Note the underperformance of several famous investors. Did they ALL become stupid at the SAME TIME?
Perhaps a way to beat the ETF driven overvaluation is to search for companies that are in few indexes such as TPL or CVEO, for example. And search for owner-operated companies. Owner_Op_Paper and Wealth-Index-Executive-Marketing-Summary-FINAL. With founder or owner-operated companies, there is less float so fewer of these companies end up in ETFs. When you see that Blackrock is a majority owner in a stock that you own but the stock represents only .003% of their five trillion dollar portfolio, you have a festering problem. Look for those founder-led companies that treat shareholders fairly:
As Charlie Munger says, “Never underestimate the power of incentives.”
Have a good weekend.
Article by CSInvesting