public investing

With smaller stocks trading at deep discounts relative to large caps, we believe the outperformance of domestically oriented firms following a historic realignment of trade terms may be ushering in a new Golden Age for Europe’s small and microcaps.

Sectors with the highest share of revenue from North America also tend to be the most expensive in Europe, namely Health Care and Information Technology, which trade at median valuations of 3.2x and 2.9x Price/Book, respectively.

Evidently, Europe’s domestically oriented firms are emerging as relative winners from the US tariffs. This makes sense because these firms don’t make negative contributions to the US trade deficit, and they are not exposed to the direct effects of US tariffs.

Nothing lasts forever. The best teams, like the longest bull markets, see their dynasties end. However, emotions are slow to change. Skepticism still sees dips as opportunities to get richer, but dips lead to false rallies, and lower lows. Each dip down compounds the losses. Doubt turns to fear. Those that bought at any price in the run up to the p... See more

Behavior follows market prices, unfortunately. Like fanatics with their sports teams, we prefer winning stocks to losing stocks. Winning stocks are rising. Losing stocks are not. And when the market is winning , excitement grows.

In the new paper, the institute examines various alternatives to the current endowment model, including the Canadian model, the McKinsey Investment Office’s portable alpha model, and the total portfolio approach now employed by allocators including Future Fund and GIC.

The Canadian model — which emphasizes direct investing by in-house talent — has b... See more

What Happened: Buffett's famous journey with the five Japanese trading houses — Itochu (ITOCF.NaE) , Marubeni (MARUF.NaE) , Mitsubishi Corp. (MSBHF.NaE) , Mitsui & Co. (MITSF.NaE) and Sumitomo Corp. (SSUMF.NaE) started not with a team of analysts or a visit to the country, but with a handbook detailing thousands of Japanese companies, according... See more

It’s not a market collapse that I see coming out of all this. That’s fire. All I can see is the long gray slog of stagflation. And I think that’s worse.

It’s a very weird place for an economy to find itself, where the entire idea of ‘risk’ gets obliterated because of an intentional erosion in the full faith and credit of the US government, and I think that all of our economic models and projections about what happens next are going to be wrong.