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Invest Like the Best

Exploring the ideas, methods, and stories of people that will help you better invest your time and money. Learn more and stay-up-to-date at InvestorFieldGuide.com
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Now displaying: March, 2019
Mar 26, 2019

My guest this week for the third time is Michael Mauboussin. If there is a major question about markets and investing, Michael has usually written one of the best pieces of research on that topic. Today’s conversation is a mix of several of his research pieces, but focuses on the sources of alpha.

The framing of the conversation is the brilliant question “who is on the other side” of a given trade. If you are buying, who is selling, and why? Knowing the answer to this question is one key to understanding where excess return comes from. As is usual with Michael, we also explore tons of other interesting ideas that will serve as food for thought. Please enjoy.

For more episodes go to InvestorFieldGuide.com/podcast.

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub.

Follow Patrick on Twitter at @patrick_oshag

 

Show Notes

1:23 - (First Question) – An outline of the syllabus for the course he teaches

4:02 – What are smart people missing when it comes to decision making

5:33 – Why Michael went down the path of defining major investing concepts

            7:41 – On the impossibility of informational inefficient markets

9:14 – Beware behavioral finance

12:03 – What are the behavioral errors that people can take advantage of in a trade

15:14 – Timing opportunities

            17:25 – Modest Proposal Podcast Episode

17:47 – Where the analytical edge comes from

21:16 – Is there an advantage to exhibit time arbitrage

23:53 – Technical arbitrage

29:34 – What impact do flows into ETFs play on the market

32:25 – Informational edge and how you source that edge

36:39 – Biggest changes that he has seen on the buy side

43:18 -  How would Michael apply this as a sports GM

48:35 – His views on stock buybacks

            51:02 – The Outsiders: Eight Unconventional CEOs and Their Radically Rational Blueprint for Success

52:55 – EBIT to EBITDA paper

            54:43 – What Does a PE Multiple Mean?

59:28 – The concept of benign myths

1:02:06 – What the future holds of Michael

            1:04:17 – The Myth of Capitalism: Monopolies and the Death of Competition

 

Learn More

For more episodes go to InvestorFieldGuide.com/podcast

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub

Follow Patrick on twitter at @patrick_oshag

Mar 19, 2019

My guest this week is with Annie Duke, and the topic of our discussion is how to improve decision making.

We break decisions down into their component parts: values, beliefs, decisions, randomness, and outcomes. After diving into each, we discuss how to make better decisions, how to work in group settings, and how to harness power of tribes and identity to improve our behavior.

Annie has thought about this as much as anyone, and her various tricks for getting us to think in probabilities and to stop evaluating decisions based on outcomes that have been tainted by randomness will be useful for anyone listening.

Please enjoy.

For more episodes go to InvestorFieldGuide.com/podcast.

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub.

Follow Patrick on Twitter at @patrick_oshag

 

Show Notes

1:23 - (First Question) – Why people don’t take the best investing advice

2:11 – Investing tribes

            4:21 – Jay Van Bavel twitter

6:34 – Rule setting as a way of crafting an investment strategy

11:13 – How much control do we have in choosing our values  

15:52 – Anatomy of a decision

19:28 – Her concept of resulting

26:47 -  How beliefs impact your decision making

34:28 – Tact’s for making the best decision

42:40 – Ego and decision making

47:06 – People who are exceptional at changing their decision making

48:18 – How often do people who change their decision making, stick with the rules of the game

            50:07 – Finite and Infinite Games

50:28 – Psychology of making decision that involves other people

59:20 -  Never close doors on other people

1:01:57 – Best decision that Annie made

1:04:24 – Kindest thing anyone has done for Annie

 

Learn More

For more episodes go to InvestorFieldGuide.com/podcast

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub

Follow Patrick on twitter at @patrick_oshag

Mar 12, 2019

My guest this week is unique and so requires a short story.

I met our guest Michael Mayer because of twitter. I followed and enjoyed one of several pseudonymous accounts that he maintains to experiment with ideas. His various accounts have wide followings.

I think many of the best accounts on twitter are anonymous or pseudonymous, and I’ve always made a point to get to know the ones I like best. As it turns out, Michael was also an entrepreneur. He’d been building a new company and was raising a small amount of outside capital.

I didn’t invest personally, in part because he raised it so quickly after I spoke with him. Ever since, I’ve gotten to know him better and followed his company, Bottomless, with interest. You know that I am always hyper transparent about any potential conflicts of interest, so it’s worth noting that while I am not an investor in this company, I expect to be at some point in the future.

The topic of our conversation is both his social media activity and his company. I am a coffee fanatic, and the problem he is solving is one I live. I order a weekly bag of coffee beans, but I often have too much coffee or run out. Bottomless solves this by shipping you a simple scale which you keep wherever you store your coffee, connect to your Wi-Fi, and set your bag of coffee on. It automatically orders new coffee for you at the right time. Thus the name: Bottomless. If you like the conversation, check out bottomless.com 

With this podcast, all I’m really trying to do is find, meet, and learn from interesting people. Michael certainly qualifies. I hope you enjoy this unique episode.

 

For more episodes go to InvestorFieldGuide.com/podcast.

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub.

Follow Patrick on Twitter at @patrick_oshag

 

Show Notes

2:06 - (First Question) – Why he writes under a pseudonym online

2:58 – Positive impacts of writing this way

3:45 – His background

5:02 – Habits he improved upon

7:03 – Where did his exploration into technology and start-ups come from

            7:33 – Algorithms to Live By: The Computer Science of Human Decisions

10:32 – Elements of business that interest him most

13:26 – Building social capital vs the current state of education

17:06 – What information does he like to consume

            18:17 – Zero to One: Notes on Startups, or How to Build the Future

            18:34 – Jerry Neumann blog Reaction Wheel | Podcast episode

            18:39 – Kevin Simler’s blog  Melting Asphalt| Podcast Episode

21:01 – Why the current education system is busted

22:54 – Formation of his business

24:04 – Importance of making things legible

25:54 – On demand delivery vs subscription business models

30:16 – Early day in developing the scale for his business

33:50 – What he learned about coffee roasters

35:29 – thoughts on supplier power

36:17 – The customer relationship

39:50 – Best objections to his business

41:58 – Biggest operational/emotional challenges

42:56 – Best moment

44:39 – Time at Y combinator

46:28 – His unique co-founder story

49:47 – Marketing strategies and acquisition costs

51:37 – The idea of a commercial loop

53:27 – Discarded ideas, such as spaced repetition social networks

57:38 – Having a long-term plan vs reformatting a business into success

1:00:35 – What works on twitter based on his experience

1:03:09 – Most controversial opinion

1:05:59 – Kindest thing anyone has done

 

Learn More

For more episodes go to InvestorFieldGuide.com/podcast

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub

Follow Patrick on twitter at @patrick_oshag

Mar 5, 2019

Peter is a geopolitical strategist who combines expertise in demography, economics, energy, politics, technology, and security to assess an uncertain future. Before founding his own strategy firm, Peter helped develop the analytical models for Stratfor, one of the world’s premier private intelligence companies.  

I came across Peter via his books the Accidental Superpower and the Absent Superpower. We discuss America’s changing place in the world and four additional countries poised to do well in the future. Spoiler alert: he believes the U.S. is particularly well positioned. 

While we don’t discuss equity markets per se, all of what we talk about will obviously impact companies across the world for the remainder of our careers. Please enjoy our conversation.

For more episodes go to InvestorFieldGuide.com/podcast.

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub.

Follow Patrick on Twitter at @patrick_oshag

 

Show Notes

1:32 - (First Question) – His model of the world

4:05 – What makes for a strategically advantaged country

5:35 – History of the Bretton Woods agreement and the order that it created

8:47 – The security apparatus that has made globalization of manufacturing possible

12:04 – The US’s pullback from being the naval police of global trade

            12:08 – The Absent Superpower: The Shale Revolution and a World Without America

14:57 – How energy has played into America’s disinterest abroad

21:52 – Moving towards global disorder

24:55 – Characterizing factors that will impact countries in any collapse

27:38 – How this manifest in physical conflict

32:44 – How the new world order will end the ease of innovation we are accustomed to today

34:13 – What gets the US to reengage before this new world order

38:08 – Demographics that make a country prepared for this, Japan as an example

40:57 – A look at China

43:59 – What the story is about Argentina

45:52 – How North America fares based on their geography and relationships

49:50 – The trader wars that are currently ongoing

52:17 – US political system

56:15 – Most important policy issues moving forward

58:27 – His view on American infrastructure

1:00:33 – Technologies that interest him the most

1:02:55 – What he is watching most closely in his research, starting with media

1:05:59 – What are and should be the countries of the future

1:06:55 – Kindest thing anyone has done for Peter

1:07:32 – Favorite places he’s been

 

Learn More

For more episodes go to InvestorFieldGuide.com/podcast

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub

Follow Patrick on twitter at @patrick_oshag

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