Tarantino

I'm a 24 years old master student of Financial Economics with a focus on banking and monetary policy. And btw -just if you wonder about my user name- I enjoy watching Quentin Tarantino movies. After my studies I'm willing to work in the asset management industry, particularly in the field of equities. However I've got no experience in managing other peoples wealth so far, I've gained some experiences on my own for almost ten years. Even though there are a lot of great investors and successful strategies out there, I've always stuck with a long-term fundamental value strategy, which has mostly been inspired by Warren Buffett. There are several reasons why I believe that a value oriented strategy is the most successful. Having learned a lot about capital market and portfolio theory, I admit that I don't believe in the CAPM and the underlying concept of the efficient market hypothesis for long-term investments. I believe that the risk of a stock is anchored in its business environment, its profit volatility and in managerial decisions. Not every great company with meaningful innovations or inventions are necessarily fruitful investments. The volatility (or variance) of a stock is generated through noise and the decisions of market participants and isn't even consistent over time. Contrarily to many people in (quantitative) finance, only because this number is easy to quantify, it doesn't mean it reflects the true systemic risk over time. Or to phrase it with Mark Twain's words: "To a man with a hammer, everything seems like a nail." My strategy is definitely not the most exciting one out there. I'm evaluating the businesses I understand about their future profits and cash-flows and compare them to their market price. In investing, as well as in life, it's not necessary to be an expert on all kinds of topics (or industries). If I'm right about the companies in my 'circle of competence', I'm able to generate a decent return versus the S&P 500. Of course I'm aware, that this requires patience, self- discipline and determination, as buying opportunities often only arise when markets have witnessed a sharp drop. show more