What is your investment approach? John Templeton, “I search for bargains.” “Buy at the point of maximum pessimism. Go where the outlook is the worst.”
The above video is worth viewing if you want to understand how important personality and values are for the type of investor you become. Templeton’s thrifty ways and contrary streak were embedded in his approach. He is seldom studied. Too bad.
Yarra Square Partners returned 19.5% net in 2020, outperforming its benchmark, the S&P 500, which returned 18.4% throughout the year. According to a copy of the firm's fourth-quarter and full-year letter to investors, which ValueWalk has been able to review, 2020 was a year of two halves for the investment manager. Q1 2021 hedge fund Read More
The Templeton Way A book synopsis
Criticism is the fertilizer of learning. –John Templeton.
John Templeton, aged 95, passed away yesterday. He will be greatly missed. Templeton was a legendary contrarian investor and a tireless philanthropist.
In February of 1987, the Templeton Emerging Markets Fund debuted on the New York Stock Exchange. Very few investors in those days cared to dabble in emerging market stocks. And after the stock market crash in October of that year, even fewer investors cared to dabble in emerging market stocks. The Templeton Emerging Markets Fund, which traded around $14 at the end of its first trading day, slumped to $6 by the end of the year.
Sir John Templeton would not have had it any other way. This uber-contrarian seemed to relish adversity. He built a career – and a fortune – by investing during what he called “the moment of maximum pessimism.” Your editor’s father embraced this same philosophy with a passion. In the nervous days of late 1987, he purchased a few hundred shares of the Emerging Markets Fund and gave them to his son, your editor.
Although delighted to receive a gift of cash in any form, your editor was not so sure he wanted to continue holding this quirky, and somewhat boring, stock. So he held it long enough to make a few bucks, then sold the stock to purchase the shares of a small drug company that eventually went bankrupt. And so began your editor’s costly education in the art, science, misery and luck of investing.