Friday, May 15, 2009

A few thoughts from Doug Kass

Those who don't follow him would be wise to do so. Doug is a dedicated short-seller, and he NAILED the downturn. Unlike some who called it right but couldn't turn that into profits. After getting it right on the short side, Kass went long in early March, calling it a "generational low" for stocks. He may be right or wrong on that measure, but the guy's research and thought process is meticulous.

I am by no means an investment purist -- "I don't want to make friends; I just want to make money!" -- but buying high and selling higher is not in my investment bag. Unlike, Jim "El Capitan" Cramer, I am no good at it.

Rather, I prefer to stick to the discipline of interpreting fundamentals, valuation and sentiment through a logically reasoned, objective and analytical process. This means that I maintain the self-control of sitting on my hands, selling and/or shorting when values are rich and buying (even recklessly sometimes) when values emerge as they did two months ago.
This is, however, easier said (or written) than done. It requires patience and, at times, a variant or contrarian view and strength of analytical conviction. It often also requires one to ignore the
business media's staccato repeated sound bytes of bullish breathlessness. Their intentions might be honorable, but quite frankly, the media, with few exceptions, have no or little skin in the game. And it often requires market participants to ignore the delivery of the talking heads whose platform is the media and whom are too frequently theatrical and shallow in their "advice" rather than substantive in their analysis.

Back in March, calling the bottom:

Doug's articles:

No comments:

Post a Comment