Invest Like the Best with Patrick O'Shaughnessy Jeremy Grantham – An Uncertain Crisis - [Invest Like the Best, EP.177]
Jun 9, 2020
Jeremy Grantham, co-founder and chief investment strategist of GMO, shares his insights on navigating today’s turbulent market. He discusses the uniqueness of the current crisis, forecasting challenges, and the evolving landscape of investing amidst uncertainty. Grantham dives into the impact of FAANG companies on traditional investing and argues for the importance of sustainable practices in a world constrained by resources. His thoughts on opportunity amidst competitive markets spark a compelling conversation about future investment strategies.
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Focus on Unappreciated Change
- Focus on unappreciated future changes in individual stocks.
- Bet against market assumptions by deducing what the market thinks.
Dopey Value’s Decline
- Simple value metrics like price-to-book worked well historically due to market overpaying for stability.
- These metrics became less effective as quantitative analysis became more prevalent.
Mean Reversion and Monopolies
- Mean reversion, the idea that asset classes revert to historical norms, underlies asset allocation strategies.
- Increased monopolies and corporate influence have weakened this process.