Top 3 Tips to Find the BEST Investment Manager.

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frankly time horizons are getting

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shorter used to be when I was uh younger

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you used to get quarterly statements and

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most people would throw them in the

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garbage now you can check your stock

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price 30 times a minute on the internet

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maybe some of you do and we're just

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playing time arbitrage we're being uh

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patient buying cheap good businesses and

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waiting for the market to recognize the

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value we see but it takes some work to

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value companies and let's say you don't

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want to do that so one thing you could

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do is try to find someone good to do it

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for you right the um showing you there's

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this opportunity maybe someone can do it

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for you and what you should probably

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look for when you're looking for that

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person is someone who has a good

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investment process the problem is uh for

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most active managers if you think of

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their challenge when they're picking an

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individual stock they must think that

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they have a variant uh hypothesis as to

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why that stock is priced differently

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than the way it should be and I can tell

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you I've been doing this over 35 years

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and it's very rare almost never have I

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bottom ticked a stock bought bought it

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at the absolute bottom so 99.9 plus% of

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the time a stock is down after I've

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bought it and there really only two

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reasons why one is I was wrong the other

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is I just need more time for my thesis

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to play out now as an outside allocator

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you don't really know what the thesis

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for the individual stock was even the

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manager himself sometimes doesn't know

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when things are going against you there

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are all kinds of agency problems you

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know you got people to answer to you

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have behavioral issues just naturally

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you start to doubt yourself it's very

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unclear sometimes even to them what

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their biases are and what they're doing

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so the allocator doesn't really

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understand the thesis behind each pick

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it's not clear that the manager uh is

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totally unbiased when he has a variant

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thesis that's going against him and so

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since you don't need know the thesis as

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an allocator most people uh all they

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have are the returns and that's what

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they used so in an interesting study uh

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that came out the day after Thanksgiving

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so it was interesting to me probably not

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interesting to the guys who did the

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study uh Morning Star put out a study of

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their star system and my interpretation

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uh and their star system is based on

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past returns letting you know who's done

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the best over the last 1 three and five

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years of course the study my

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interpretation of their study was that

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our star system doesn't work we can't

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discern