Shawn Burns is Solve the Riddle

  EXPLORING THE FOUNDER MYTH Investing is a complex business, and many try and simplify a message to get a point across. The ability to convey complex subjects succinctly and simply is a rare skill and worth a lot in the industry. With it usually comes a compromise of the subject matter and often a misunderstanding. These messages operate at the helicopter level and don’t deal with the nuance and detail so critical in the art of investing, imo. For example, take the word “value” investing. What does that mean to the average punter? I would answer so many things that it is almost meaningless to use. This blurb explores the much-used founder myth as a way to investing nirvana. All my own opinions and comments, so beware-could be wrong. The theory is built on the premise that investing alongside founders is a low-risk way to invest in the share market and will deliver much outperformance. Some statistics are often forwarded to support that theory, but I have seen statistics that s...

  WHY I DON’T CONSIDER OTHER PORTFOLIO’S PERFORMANCE IMPORTANT Being a professional money manager, you become, perhaps, one of the most analysed people there is. Attribution runs continuously while the markets are open; anyone within the firm can see, minute by minute, how you perform. You are acutely aware of where the pleasure and pain are coming from, stock by stock, point by point. That is not a healthy state, it encourages emotional reactions that are not consistent with cool, rational judgment and action, which are the hallmarks of successful investing. The point here is that too much information and too much looking and cause adverse outcomes. The second point I want to make about professional management is that the reason for being and, in particular, mandates, are usually very narrowly defined. You pitch your skills with a particular bent, which is usually factor-focused. For instance, you are the best value manager or growth manager. The fund management industry has b...