I strive to be smart, wise, analytical, creative, intuitive, and informative. I hope to help make you a better active investment management pro.
I recommend you start with the Best of the Blog.
Top 10 Things That Hurt Active Management, 1 to 5
Last week I described the top 6-10 things that hurt active management, along with 3 honorable mentions. This week I hit the really juicy things in numbers 1 to 5. In brackets are those who I think bear responsibility for the item. But a slight side step, first. I received a good suggestion from pal, Gordon Ross, CFA which is to invite each of you to provide your own ranking of the Top 10. Feel free to mix in the honorable mentions, as well. And (and this is a big AND) also free to name some of your own Top 10 Things That Hurt Active...
read moreFrom the Research Chair: A new podcast featuring me and Michael Falk, CFA, CRC
Michael Falk, CFA, CRC and Jason A. Voss, CFA host From the Research Chair, a twice monthly show designed to help your teams improve their investment philosophy, process, and execution. In Episode 1 we will discuss the crucial elements of sound investing based on our years spent as successful practitioners, as well as our embedding with dozens of investment teams in our consulting work. Come to hear about best practices and… more. Join our intro session on Thursday, June 25 at 12pm ET. LIMITED TO 100 PARTICIPANTS. Register here: ...
read moreTop 10 Things That Hurt Active Management, 6 to 10
Many active managers wrote to me directly after last week’s article (my 2nd most popular ever), and I made many new friends along the way. Given that I am the CEO of Active Investment Management (AIM) Consulting, LLC, let’s keep with our active management theme. Over the next two weeks I will be counting down to #1 my Top 10 Things That Hurt Active Management. As you will see, many of these things interrelate with one another, so ranking them properly is tough. Also, just below the items I have put in brackets who I think bears the...
read moreWhy Active Management is Not Zero Sum
Another day, another controversial subject within investment management I am taking on. In this post I discuss and hope to dismantle an oft-repeated missive about active management. Namely, that active management is zero sum. For brevity’s sake, I propose the acronym of AMIZS (pronounced, “amazes”) as a stand in for “active management is zero sum.” AMIZS is Logical…Right? Here are the assumptions of the logical argument put forth for why active investment management theoretically must be zero sum. Let’s assume that the split of...
read moreThe Most Misunderstood Investing Concepts: Portfolio Management
In this edition of The Most Misunderstood Investing Concepts I discuss portfolio management, which, in my opinion is overwrought. In case you have missed other pieces in this series here are links to each of them: Fair value and its evil twin, target price; Time horizon and its subterranean influence on investors’ thinking; PEG ratios and the ignorance of the math underlying them; When valuing a business, growth is not free!; Risk does not equal volatility; and, Alpha is creativity. Portfolio Management’s Conventional Understanding...
read moreMastering Anxiety: Fear and Anxiety Are Not the Same Thing
Having managed money well during two recessions and September 11th, I know a thing or two about investing during moments of high tension. In fact, most of the returns I earned for my investors were during moments of such crisis. One crucial piece of advice that I can render in the face of events like COVID-19 is the distinction between fear and anxiety. By the way, a full fledged description of these differences is covered in my 2010 book, The Intuitive Investor. Fear ≠ Anxiety Most people use fear and anxiety interchangeably. This...
read more7 February 2020 – WSJ: A New Way for Stock Traders to Rebalance – Meditation
Hello all, Just a quick note to let you know that I was recently quoted in the Wall Street Journal today, 7 February 2020, in an article entitled, “A New Way for Stock Traders to Rebalance – Meditation.” This is work that I love to do for organizations, and it is nice to be recognized by the WSJ. Thanks to Nick Ravo for the feature. With smiles, Jason
read moreThe Major Behavioral Biases Influencing Your Investment Decisions
Jason Voss recently spoke at the 2019 AAII Investor Conference. If you weren’t able to attend, session audio and handouts are available for purchase at: www.aaii.com/investoraudio. Recognizing the major biases is the first step in learning how to avoid them in your investing. You may not believe it, but science has proven that you and I are biased and often make irrational decisions. Here is the evidence. Imagine a game pays $1.10 if a fair coin comes up heads and costs $1 if it comes up tails. You can participate in this...
read moreCreativity in Investment Firms: Five Conditions to Improve It
By Jason Voss, CFA and Jim Ware, CFA What will investment firms need to thrive, probably even survive, in the years ahead? Creativity — both possessing it and harnessing it — will be essential. How do we know? Because we asked, and at the recent Focus Consulting Group (FCG) Leadership Forum on Creativity, investment leaders gave us an unequivocal answer. In order to survive and thrive, will you need to get more creative? Yes Neutral No 85% 5% 10% As if those numbers weren’t evidence enough, we queried staff from over 100 firms...
read moreFederal Reserve Stimulus to Daily GDP…WTF?!
I wanted to share with you shocking data that, for whatever reason, is not getting more widespread coverage. Namely, the total amount of economic stimulus (money printing) that the Federal Reserve is engaged in at the moment. I then compare the total amount of that stimulus to daily Gross Domestic Product (GDP) is the U.S. to reveal the insane amount of stimulus taking place. Below is the stimulus that has taken place since 14 November 2019. Note: the source for all is the Wall Street Journal. However, due to how they report stories, the...
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