The Intellectual Investor

A client emails me: stock XYZ has declined 25%, is the thesis broken? It’s a fair question, and the honest answer is one I want to walk through carefully, because the same client letter brought a second question wearing different clothes: how do you tell the difference between patience and stubbornness when a position isn’t working?

Both questions get at something I think about constantly: how to hold a position through doubt without either flinching at noise or hardening into ego. Daily liquidity in the stock market is both a feature and a bug, and most of the job of being a long-term investor is learning to take the feature without getting hurt by the bug.

I work through why I don’t try to interpret daily price movements anymore, and why trying to make sense of them is like looking for deep meaning in the poetry of inmates of an insane asylum. I talk about reading the press release and listening to the earnings call before I look at the stock price, so “the market” (a computer, a day trader in his mom’s basement, or a fund manager with braces to pay for) doesn’t tell me what to think about a company’s performance.

Then I take on the harder question. I lay out what separates patience from stubbornness, why one investor is in scientist mode and the other is engulfed by ego, and why the line between hero and anti-hero is thinner than most of us want to admit. I borrow from Soul in the Game along the way.

The full piece is at investor.fm. _________________________________________________________ 📩 Join 100,000+ readers on Vitaliy’s FREE weekly newsletter: https://investor.fm/sign-up/

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_________________________________________________________ WHO AM I: Vitaliy Katsenelson is the CEO of Investment Management Associates (IMA) and an award-winning writer. Forbes Magazine called him “The New Benjamin Graham.” His work has appeared in the Financial Times, The Wall Street Journal, Barron’s, Fortune, Institutional Investor, and Foreign Policy. He is the author of three books, including Soul in the Game: The Art of a Meaningful Life. _________________________________________________________ Please read the following important disclosure: https://investor.fm/disclosure/

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