Dev Raga Personal Finance 333 an interview with Owen Rask part 2 (value investing, index fund bubble + more)
Aug 15, 2023
In this episode, Owen Rask from the Rask Group discusses value investing, valuing different businesses, concerns about the index fund bubble, and the impact of index funds on the market. He also shares his approach to investing, the importance of intentionality with money, and finding purpose in life. The podcast concludes with a discussion on creating a vision board for prioritizing happiness and aligning priorities with a higher purpose.
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Two Core Valuation Frameworks
- There are two core valuation frameworks: cash flows to the firm and cash flows to equity.
- Use discounted cash flow for firm-level valuation and dividend/IRR methods for investor cash flows.
Qualitative Edge Beats Pure Quant
- Qualitative research captures most of the edge in value investing compared with purely quantitative approaches.
- Human behavioral insights like customer visits and management calls matter more as algorithms dominate quantitative edges.
Examples: WA H. Soul Pattinson And ARB
- He uses Washington H. Soul Pattinson as a steady holding-company example valued by dividends or sum-of-parts.
- He contrasts that with ARB, a fast-growing single-vertical aftermarket business suited to DCF despite higher risk.