Tag: Strategy
Sometimes the market is best viewed from afar
That investment style of being in touch with the market but distant from it has impressive antecedents and performance.
Same old folly, new spiral of risk
Risk markets are based more on imperfections of information and understanding than on differences in attitude to risk. And with this, financial follies repeat themselves in each generation.
Paradox plays a part in a modern fable of economics
Bear in mind the gambler’s advice: if you don’t know who is the patsy in the room, it’s you.
Mr Market vs the voting machine
The anthropomorphic metaphor of the market is too relativist, the view of the market as a voting machine is too rationalist: to take either too seriously leads to error.
Energy wisdom is knowing that you do not know
We should eschew forecasts, acknowledge unresolvable uncertainty and plan accordingly. The right energy policy is one of diversification – developing as many uncorrelated options as possible.
Conflicting creeds: how to value art, houses and Asian stock
For fundamentalists, the value of an asset is the sum of the returns it will yield over its life. For fellow travellers, an asset is worth what someone else is willing to pay for it.
Prudence is knowing that not all swans are white
Models are only as good as the correspondence between the model and the world, and this is where problems begin.
Dreams are no basis for a sound corporate strategy
An effective business strategy is not separable from execution and is not based on visions and dreams, but on a match between capabilities and activities.
Arguments for private equity are not always convincing
Private equity promoters propose layer upon layer of debt, leveraged by non-recourse finance. But the same finance theory also tells us that you do not increase the value of an investment portfolio by increasing gearing.
Watching share prices will not make you happy
The paradox is that if you do not have complete control over your emotions, you can have too much information for your own good.
