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Contrarian Investing with GMO's Ben Inker - FEG Insight Bridge
Feb 5, 2025
Ben Inker, Co-head of asset allocation at GMO, shares his insights on contrarian investing, drawing from his experiences influenced by mentors like Jeremy Grantham. He and Greg Dowling, CIO at FEG Investment Advisors, delve into the significance of deep value stocks in today's market. They discuss the challenges posed by the rise of passive investing and the concentration risks in large-cap tech stocks. Together, they explore emerging opportunities in underappreciated sectors, like Japanese small caps, offering valuable perspectives for savvy investors.
50:41
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Quick takeaways
- A deeper analysis of asset returns is crucial for investors, as it reveals sustainable trends versus random fluctuations for better decision-making.
- The podcast emphasizes the potential of Japanese small-cap stocks, which offer strong fundamentals and competitive advantages amid current overvaluation concerns.
Deep dives
Understanding Asset Returns
The discussion emphasizes the importance of dissecting asset returns to identify their underlying drivers. It highlights that merely focusing on past performance can be misleading, as understanding the factors contributing to those returns can provide more accurate insights into future prospects. Ben Inker posits that a deeper analysis can reveal which returns may be sustainable, which might reverse, and which could be random fluctuations. This analytical approach is foundational to effective asset allocation and is crucial for individual investors aiming to make informed decisions.
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