The Intrinsic Value Podcast - The Investor’s Podcast Network

MI307: Unpacking The Money Mind w/ Robert Hagstrom

Nov 21, 2023

Investment expert and author, Robert Hagstrom, discusses the benefits of reading fiction for investing, best mental models he learned from Bill Miller, understanding complex adaptive systems, using the DCF model according to Buffett and Munger, strategies for using multiple mental models, and interesting data points on concentrated portfolios.

01:03:31

Episode guests

Robert Hagstrom

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Episode notes

Podcast summary created with Snipd AI

Quick takeaways

Reading fiction improves investors' problem-solving skills and broadens their perspectives.

Developing a MoneyMind involves aligning one's view of the market, investing methods, and temperament.

Reading outside the finance realm and intelligent skimming can lead to valuable insights and enhance decision-making in investing.

Deep dives

High Active Share and Focus Investing

High Active Share, or focus investing, is the academic term coined by professors from Yale University to measure the degree of difference between a portfolio and its underlying index. Their research found that portfolios with high active share, meaning more concentrated holdings, tend to outperform the market. This finding holds especially true for portfolios with low turnover strategies, indicating that a concentrated, low turnover approach is the optimal way to generate returns.

Introduction

3min

The Value of Reading Fiction for Investing

17min

Valuing Assets Based on Future Cash Flows and Discounted Rates

4min

Building Good Mental Models and Incorporating Various Disciplines in Investing

3min

Warren Buffett's Perspective on Volatility

32min

Connecting with the Guest and Promoting the Investors Podcast Mastermind Community

2min

Kyle Grieve chats with Robert Hagstrom about the benefits of reading fiction for improving your investing process, the best mental models Robert learned from his time working with Bill Miller, the importance of understanding complex adaptive systems for understanding the market, how to use the DCF model according to Buffett and Munger, strategies for using multiple mental models in your day-to-day life to think better, and a whole lot more!

IN THIS EPISODE, YOU’LL LEARN:

00:00 - Intro

03:48 - The Lessons from 3 of fiction's best detectives that will make you a better investor.

10:16 - Insights from investments in Dell Computer and Amazon.

10:37 - Why you should look at the market through a biological model over a physics-based model.

10:37 - The importance of network economics in a digital age.

26:55 - Ways to improve efficiency from books that you read.

38:10 - Interesting data points on the advantages and disadvantages of a concentrated portfolio.

And much, much more!

*Disclaimer: Slight timestamp discrepancies may occur due to podcast platform differences.

BOOKS AND RESOURCES

Join the exclusive TIP Mastermind Community to engage in meaningful stock investing discussions with Kyle and the other community members.
Buy a copy of The Warren Buffett Portfolio: Mastering the Power of the Focus Investment Strategy here.
Buy a copy of Warren Buffett: Inside the Ultimate Money Mind here.
Buy a copy of The Detective And The Investor here.
Buy a copy of Investing: The Last Liberal Art here.
Buy a copy of The Warren Buffett Way here.
Related Episode: Listen to TIP360: Inside The Money Mind Of Warren Buffett w/ Robert Hagstrom, or watch the video.
Related Episode: Listen to MI222: How To Invest Like Warren Buffett w/ Robert Hagstrom, or watch the video.

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