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TIP674: Outperforming the Market, Managing Risk, & Market Inefficiencies w/ Andrew Brenton

Nov 8, 2024

In this conversation, Andrew Brenton, CEO of Turtle Creek Asset Management, shares wisdom from his 25 years of beating the market. He emphasizes the drawbacks of a buy-and-hold strategy and discusses how US markets are becoming less efficient. Andrew gives insights into allocating investments in AI and software, and reveals Turtle Creek's approach to risk management. He also highlights their recent addition of Kinsale Capital to the portfolio, showcasing how exceptional management plays a pivotal role in navigating market dynamics.

01:11:39

Episode guests

Andrew Brenton

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Episode notes

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Quick takeaways

Andrew Brenton critiques the buy-and-hold strategy, advocating for continuous portfolio evaluation to optimize investments based on intrinsic value changes.

The U.S. stock market's growing inefficiency presents opportunities for strategic investors to capitalize on fluctuations and fundamental analysis.

Turtle Creek focuses on investing in innovative companies through technology, thus managing risk and enhancing growth potential across different sectors.

Deep dives

Long-Term Investment Success

Turtle Creek Asset Management, co-founded by Andrew Britton, has demonstrated remarkable investing success since its inception, averaging a 20.3% annual return. Compared to the S&P 500's 8.3% return during the same period, this performance highlights effective investment strategies. An initial investment of $10,000 in Turtle Creek would have grown to over $1.2 million by September 2024, signifying the substantial benefits of their approach compared to just $75,000 if directed to the S&P 500. This significant outperformance over 25 years reflects a deep understanding of market dynamics and an ability to adapt to changing economic conditions.

Intro

2min

Strategic Investment Approaches

9min

Navigating Market Inefficiencies

7min

Investment Strategies and Market Dynamics

24min

Navigating Risks and Opportunities in Investments

4min

Analyzing Market Dynamics: US vs Canadian Companies

6min

Navigating Investment Strategies

14min

Connecting Investors: Opportunities and Community Engagement

2min

On today’s episode, Clay is joined by Andrew Brenton to discuss his biggest investment lessons from beating the market over the past 25 years.

Andrew Brenton is the CEO and co-founder of Turtle Creek Asset Management. Since its inception in 1998, Turtle Creek has achieved an average annual return of 20.3% versus just 8.3% for the S&P 500. $10,000 invested into their fund at inception would have grown to over $1.2 million as of September 30th, 2024, and had that money been invested in the market, it would have been worth around $75,000.

IN THIS EPISODE YOU’LL LEARN:

00:00 - Intro

01:39 - The fundamental drawbacks of a buy-and-hold investment strategy.

10:58 - Why the stock market in the US is becoming less efficient over time.

28:48 - How Andrew thinks about allocating to AI and software businesses in his portfolio.

38:51 - How Turtle Creek manages risk investing in stocks.

52:55 - Why Turtle Creek added Kinsale Capital to their portfolio this year.

01:00:02 - What keeps Andrew going after 30 years in the industry.

And so much more!

Disclaimer: Slight discrepancies in the timestamps may occur due to podcast platform differences.

BOOKS AND RESOURCES

Join the exclusive TIP Mastermind Community to engage in meaningful stock investing discussions with Stig, Clay, Kyle, and the other community members.
Check out Turtle Creek Asset Management.
Related Episode: Listen to TIP592: Outperforming the Market Since 1998 w/ Andrew Brenton, or watch the video.
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