What drives the success of the "big brains" of the investing world | stockbee


What drives the success of the "big brains" of the investing world

Business Week has a article about what distinguishes the smarter players from ordinary players in the market.
The 10 investors highlighted in the story are John Bogle, Warren Buffett, David Shaw, G. Kenneth Heebner, Bill Gross, John Templeton, Carl Icahn, David Swensen, George Soros, Stephen Schwarzman

What drives the success of the "big brains" of the investing world—and what ordinary investors can learn from them

What separates the billionaire investors from the millionaires? What do the world's investing geniuses have that the rest of us don't? Besides good luck and a pile of money, that is.

When we came up with a list of the biggest brains in investing, we noticed how much each of them has influenced the way the world invests. And we noticed one other trait: Each saw opportunity well before the pack. John Templeton pushed international investing way before it was cool. Warren Buffett was buying up undervalued companies long before his brand of value investing became popular. David Shaw used high technology and smart PhDs to make money on countless split-second trades, now a common hedge fund strategy.

Many of the world's top investors got to the top by being first. They didn't follow in the footsteps of others or copy wholesale the investing styles of others. At the beginning of their careers, "they set themselves apart from the crowd," says Walter Gerasimowicz, chairman and CEO of Meditron Asset Management.

Standing out like that can require a lot of courage, especially on financial markets that, by their very nature, represent the epitome of the herd mentality. John Merrill, chief investment officer of Tanglewood Capital Management, calls this trait "intellectual integrity." Top investors "think for themselves. They defy conventionalism," Merrill says.

Perhaps this is why any list of the world's top investors represents a vast array of political beliefs, personality quirks, and strange hobbies. While some keep a low profile, people like Buffett and bond king Bill Gross seem to love regaling others with their views.


ybn said...

Just to be the cynic, I'll bet that for each "Big Brains" success there are at least a thousand "big Brains" failures who were also first in their method but lost it all. I think luck is a big factor in being the "first" in the right place at the right time. All my first methods never worked out very well. Now I follow your earnings and EP guidance and I am doing great.

ivanhoff said...

You can't be lucky 40 years in a row.Don't confuse luck with hard work and deep market understanding. The article is about the reason for the achievement of superior and consistent returns over longterm time frame, not about peanuts money.