In a captivating conversation, Paul Enright, a private investor at Krainos Capital and former Viking Global Investors expert, shares his journey in long-short equity investing. He delves into the nuanced differences between business analysis and stock picking, emphasizing strategic portfolio management. Paul discusses the implications of liquidity on valuations and offers insights into compensation structures within finance. He also reflects on managing personal investments and provides valuable advice for emerging portfolio managers, all while addressing thought-provoking questions from his Twitter followers.
01:05:58
forum Ask episode
web_stories AI Snips
view_agenda Chapters
menu_book Books
auto_awesome Transcript
info_circle Episode notes
question_answer ANECDOTE
Paul's Career Path
Paul Enright grew up in Brooklyn with no exposure to stocks, encouraged to pursue traditional career paths.
He discovered his passion for investing after working as a lawyer, tax advisor, and sell-side analyst.
question_answer ANECDOTE
Training at Viking
Paul's training at Viking Global Investors involved working with different portfolio managers, each with unique styles.
He learned from Brian Olson, David Ott, and especially Tom Purcell, who he credits with greatly influencing his career.
insights INSIGHT
Stock Picking vs. Business Analysis
Stock picking and business analysis are distinct. Business analysis focuses on understanding the underlying business.
Stock picking considers valuation, liquidity, technicals, and how stocks interact within a portfolio.
Get the Snipd Podcast app to discover more snips from this episode
In this book, Carol S. Dweck introduces the concept of two mindsets: the fixed mindset and the growth mindset. People with a fixed mindset believe their abilities are static, while those with a growth mindset believe their abilities can be developed through effort and learning. Dweck shows how these mindsets influence success in school, work, sports, and personal relationships. She also discusses how to adopt a deeper, truer growth mindset, and how this can transform individual and organizational cultures. The book emphasizes the importance of perseverance, learning from failures, and embracing challenges as key components of the growth mindset[1][2][5].
Paul Enright is a private investor managing his own capital under single family office, Krainos Capital. Paul opened Krainos after a dozen years at Viking Global Investors, the multi-billion dollar long-short equity hedge fund that also has been one of the most successful breeding grounds for talent in the industry. He has a deep understanding of intricacies of long-short equity investing and a knack for explaining it well. Our conversation covers Paul’s career path to Viking, training while there, and advice to early-career investors. We dive into the distinction between business analysis and stock picking, and the importance of portfolio management to investment success. In the process, we discuss liquidity, shorting, portfolio rebalancing, incentive compensation, and market structure. We close with Paul’s approach to managing his own money and his answers to a terrific set of questions sourced from his Twitter feed before the show.
(3:11) Paul’s background (8:11) Training at Viking (10:02) Stock picking (12:18) Business analysis (19:54) Liquidity’s impact on valuation (24:03) Dynamic portfolio management (28:46) Rebalancing (32:03) Long/Short Dynamics (40:50) Compensation structures (43:11) Current market structure (50:29) Investment model as a family office (53:05) Thoughts on Twitter (57:07) Growing skills as a young PM (58:57) Advice to PMs in tough times (1:01:48) Best questions to ask managers (1:03:11) Closing questions
Capital Allocators – Inside the Institutional Investment Industry 