STREET DOGS: Like a clock during a thunderstorm
You have to recognise that your own thoughts are not your own thoughts
In investing, you want to do something that no one else is doing or that very few others are doing," says Patrick O’Shaughnessy at O’Shaughnessy Asset Management. "But not just because there is no one else doing it, but also because it makes sense to do. Value has worked historically because it is a clean way to buy stuff that others dislike. "The best value stocks have a few other attributes. "As Seth Klarman puts it, you want to have a contrarian streak and a calculator. "But now everyone likes value. The ’value tilts’ which are introduced into portfolios in smart beta or similar strategies aren’t the real McCoy. "Value should hurt!! It doesn’t hurt to buy a fundamental index. If it doesn’t hurt, it should at least scare you. "Scare you because the stocks look terrible, because they’ve done badly or because buying a particular basket of stocks introduces the career risk that we must accept if we are to own unique portfolios. "Contrarian value strikes me as creative. Value tilts ma...
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