Superior Returns Through Being Contrarian

The 5% successful in the investment world are those who go against the crowd. They invest when others panic, avoid following trends, and remain immune to herd mentality. By being contrarian and not following the tribe, they can generate superior returns. To outperform others, one must do things differently, not follow the majority.

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On today’s episode, Clay is joined by François Rochon to discuss how he’s managed to vastly outperform the market over the past 30 years. Since he started the Rochon Global Portfolio in 1993, his annual returns net of fees have been 13.6%, versus 9.2% for the benchmark.

François’s investment approach is firmly rooted in three principles — patience, humility, and rationality — which are discussed in depth during this conversation.

IN THIS EPISODE YOU’LL LEARN:

00:00 - Intro

02:17 - What led François to hiring Jean-Philippe Bouchard.

06:19 - The foundational investment principles of Giverny’s approach.

10:23 - How François realized so early in his career that you can’t predict the stock market.

19:53 - The tribal gene that sets 5% of investors apart from the rest.

29:29 - How we can be prepared for declines in the stock market.

35:37 - Why his biggest investment mistakes are mistakes of omission.

40:54 - How François views Berkshire Hathaway’s role in his portfolio.

45:27 - How François assesses the strength of a brand.

56:02 - His view on the valuation of today’s market.

68:15 - Why François is so passionate about investing.

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.
Giverny Capital’s Letters.
Learn more about the Giverny Capital.
Books Mentioned: How to be Rich, Money Masters of our Time, The Craft of Investing.
Related Episode: RWH016: The Best of the Best w/ François Rochon | YouTube Video.
Follow François on LinkedIn.
Follow Clay on Twitter.
Check out all the books mentioned and discussed in our podcast episodes here.
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