Excess Returns

Dispelling Big Investing Myths | Dan Rasmussen

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Dec 12, 2024
Guest
Dan Rasmussen
Dan Rasmussen, founder of Verdad Advisers and author of "The Humble Investor," discusses compelling market insights. He explains why high bond yields may not equal high returns and the potential in undervalued international stocks. Dan explores how private equity performance hinges more on portfolio construction than manager skill. He highlights positive changes in Japanese corporate governance and assesses UK market valuations post-Brexit. With a focus on humility in investing, he challenges prevailing market assumptions, offering valuable perspectives for all investors.
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INSIGHT

Meta-Analysis in Investing

  • Investing is not about your analysis, but your analysis relative to the market consensus.
  • Identifying how your ideas differ from popular opinion is crucial.
INSIGHT

Humility in Investing

  • Acknowledge the limits of understanding in investing; forecasting is imperfect.
  • Focus on where others are too confident and how to profit from their mistakes.
INSIGHT

Yield vs. Return

  • High bond yields don't guarantee high returns; yields and total return often diverge due to factors like defaults and downgrades.
  • This "fool's yield" phenomenon traps investors reaching for yield without properly assessing risk.
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