10
Jun
2020
Recurring revenue and moats
A friend on twitter, Andrew who runs https://www.fundhunter.co/ asked an interesting question: is recurring revenue a “moat” in itself? That is, do all companies that have recurring revenue / customers who stay for years, have competitive advantages (and by implication report high returns on capital). After thinking about it for 10 seconds I replied with... Read More
25
Apr
2020
Analysing uncertainty – TMI
“These days everyone has the same data regarding the present and the same ignorance regarding the future.” Howard Marks I’m fascinated by this talk on Three Mile Island (TMI) and analysing different stories around what caused the disaster. Please do watch the whole thing. You’ll thank me I promise! Who, or what, was to... Read More
9
Apr
2020
Sailing into the unknown
Not many things seem obvious at the moment. But one thing that does, is the likelihood that companies will need more cash from shareholders. Historically, the stockmarket was a mechanism for raising capital for uncertain trade ventures into uncharted territory. Starting with the Muscovy Company, the first Joint Stock Company in 1553 expedition round the... Read More
11
Feb
2020
Quant Winter
According to this recent article in FT just 15% of quant funds beat the US stockmarket index last year. Cliff Asness, head of AQR, which employs over 80 phDs and manages $186bn, has called it a “quant winter”. However, the “quant winter” has now lasted a couple of years. Old fashioned “active” portfolio managers have... Read More