Drew's Views

I’ve been keeping a graphic of the long-term performance of the US stock market for many years now, and I’ve been sharing this information in the histogram below. I think it does a reasonable job of revealing how long-term returns are manufactured and the tilts over time. I’ve color-chunked the data by decade to highlight decades of historical weakness as well as periods of strength. I’ve also added additional tables and charts which I think are interesting, and in some cases, stunning.

It's very possible, if not likely, that the move in growth stocks from 2017 through 2020 probably wasn’t caused or justified by a move in interest rates, but that people believed, and acted like, it was.

Drew and Toby chat about narrative-driven investing, Ben Graham's voting machine, behavioral explanations for stock mispricing, and managing a concentrated portfolio of investment ideas.

Growth stocks crushed just about everything from 2017 through 2021. Not that they necessarily will, but if they do give back some or all of their gains, given their weightings, times will be tough for broader indices. But what about the value names within them, will they sell off in sympathy as well? Of course no one knows, including ourselves, but we take a quick look at behavior of value names as the tech bubble sold off from 2000 through 2002. This example may be worth some consideration.

Some year-end charts and tables asking some big questions about what comes next.

I know, these are weird and trying times. It all makes you wonder what the point of stock-picking is. What is the purpose of kicking the tires, looking under the hood, and doing our jobs?

In 1861, at the outset of the Civil War in the United States, Union Pacific issued 20 shares in its IPO.

Many of you will be familiar with the so-called “hot-hand” fallacy, or (perhaps) the lack thereof.

On first principles, there is one way to generate excess stock market returns over the long term, and it isn’t to “own winners at any price.”

I was out shooting baskets this weekend, thinking about the concept of inversion.

COVID-19 and related counteractive policies have had an extremely negative impact on domestic and global economies. Whether or not you believe that the policies weren’t strong enough, or if they were overzealous, we are where we are.

Here at the Albert Bridge Restaurant, the investment team has the chefs, the IR team has the waiters, and the operations team ensures that the shop runs smoothly so that we can keep on serving up alpha (hopefully) to you, our customers.

Market headlines, globally, have been dominated by the storied performance of a select few transformational, winner-take-all business models.

Some of you may remember the quant crash of August 2007.

These are our two cents on whether you, or we, or anyone else can pick the perfect time.

Mr. Market has been increasingly attracted to and enamoured by the concept of “quality” investing. So, let’s explore it.

The trend from active to passive (or systematic) investing is now well-entrenched.