Value Investing with Legends

Columbia Business School

  • 37 minutes 23 seconds
    Phil Ruvinsky - Sustainable Competitive Advantages in Technology

    In this episode, Michael Mauboussin, adjunct professor at Columbia Business School, hosts Phil Ruvinsky, Managing Director and Head of the Fundamental U.S. Growth Team at BlackRock. With extensive experience in the investment industry, Phil shares his journey from law to finance, discusses his investment philosophy, and explains the importance of sustainable competitive advantages. The conversation explores the evaluation of management, the impact of AI on the competitive landscape, and the nuances of portfolio construction. Phil also highlights the role of macroeconomic factors and regulatory changes in investment decisions, shares his thoughts on the future of active management in an increasingly indexed market, and much more!

    Key Topics:

    • Introduction to Phil's career and background (1:06)

    • Transition from law to investment and early career challenges (2:15)

    • Importance of business school in shaping investment philosophy (3:47)

    • Recommended books for new team members (4:22)

    • Utilizing competitive strategy analysis in investment decisions (5:50)

    • Unique characteristics of technology, media, and telecom sectors (7:03)

    • Analysis of return on invested capital in different business models (9:10)

    • Approaches to valuation and use of different tools (10:25)

    • Evaluating the importance of management in investment decisions (12:15)

    • Impact of AI and generative AI on the competitive landscape (14:17)

    • Application of AI in the investment process (18:07)

    • Trends in market concentration and their implications (20:26)

    • Effects of indexing and rules-based investing on markets (23:27)

    • Corporate governance, capital allocation, and executive compensation (25:35)

    • Differences between being an analyst and a portfolio manager (28:02)

    • Portfolio construction and risk management (29:38)

    • Considering macroeconomic factors in investment decisions (32:00)

    • Concerns and excitement about the future (34:21)

    • Phil's book recommendations (35:58)

    • And much more!

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    12 July 2024, 8:00 am
  • 1 hour 1 minute
    Anu Bradford - EU Influence, Big Tech Challenges, and the Future of Digital Governance

    In this episode, hosts Tano Santos and Michael Mauboussin speak with Anu Bradford, the Henry L. Moses Professor of Law and International Organization at Columbia Law School, to discuss the intricate dynamics of global technology regulation. Anu is recognized for her deep expertise in international economic law. Her pivotal books "The Brussels Effect" and "Digital Empires" explore how significant regions like the US, EU, and China shape technological standards worldwide. The conversation probes the complexities of regulating big tech companies across different legal and political landscapes, highlighting the significant influence of European regulations on global markets. She also touches on the impact of regulatory practices on innovation, the challenges of enforcing extensive digital laws, and the future trajectory of global tech governance. This episode offers a comprehensive look into the power struggles and cooperative efforts that define international technology regulation and much more!

     

     

    Key Topics:

    • Introduction to Anu Bradford and her background (04:01)
    • The unique position of the EU in global regulatory practices and its impacts (10:48)
    • Detailed exploration of "The Brussels Effect" and its significance (12:56)
    • Global market influence through regulatory strategies (17:02)
    • The challenges and methodologies of tech regulation in the EU, US, and China (31:55)
    • The role of data security and privacy in international relations and tech regulation (43:06)
    • Future challenges and directions in global technology regulation (52:47)
    • The preservation of liberal democracy in the digital age (54:51)
    • Anu's book recommendations (58:56)
    • And much more!

     

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    28 June 2024, 8:00 am
  • 1 hour 4 minutes
    Jonathan Knee - The Platform Delusion and the Intricacies of Digital and Analog Platforms

    In today's discussion, Jonathan Knee, a distinguished advisor at Evercore Partners and Professor of Professional Practice of Media and Technology at Columbia Business School, explores the themes of his influential work, "The Platform Delusion." Jonathan's insights stem from a rich career in both the banking and academic sectors, bringing a nuanced perspective on digital versus analog platforms, competitive strategies, and the evolving landscape of technological advancements. The conversation uncovers the myths surrounding platform businesses and their impact on the economic principles that govern market dynamics. Jonathan also discusses the implications of regulatory frameworks and their intersection with business strategies in shaping industries and so much more!

     

     

    Key Topics:

    • Jonathan Knee's background and expertise in media and technology (01:40)
    • The initial impetus behind writing "The Platform Delusion" and the misconceptions it addresses (13:14)
    • Definitions and the real economic underpinnings of platform businesses (17:52)
    • Competitive advantages and the robustness of network effects in digital platforms (35:02)
    • Exploring the sustainability of various business models within tech giants like Meta and Google against emerging technologies (44:51)
    • Insights into the strategic decisions that have fortified Apple's market position over the years (48:38)
    • The impact of generative AI on existing business ecosystems and future market trends (55:36)
    • Societal and technological transformations influencing today's business environment (58:55)
    • Jonathan’s book recommendations (01:01:30)
    • And much more!

     

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    14 June 2024, 8:00 am
  • 45 minutes 54 seconds
    James Bessen - Understanding the Tech Paradigm

    In the third episode of Season 10, hosts Tano Santos and Michael Mauboussin speak with James Bessen, Executive Director of the Technology and Policy Research Initiative at Boston University. Delving into the intricacies of technological advancement and market dynamics, Bessen shares his insights on the evolving landscape of competition and innovation. The discussion highlights the impact of proprietary software on industry disruption, exploring the significant shift from mass production to mass customization facilitated by technology. This episode not only provides a deep dive into the challenges and opportunities presented by the digital age but also prompts a reflection on the future of value investing in a tech-dominated world and so much more!

     

     

    Key Topics:

    • Welcome to Season 10 of Value Investing with Legends (0:20)
    • Exploring the concept of barriers to entry in value investing (1:05)
    • James Bessen discusses technology's economic impact (3:15)
    • Analysis of the decline in economic disruption despite technological growth (5:10)
    • Impact of proprietary software on industry stability and market concentration (6:35)
    • Historical perspective on technology's influence on the economy (8:25)
    • The role of proprietary software in shaping competitive dynamics (10:30)
    • The transition from mass production to mass customization in retail (12:05)
    • Walmart’s evolution and strategy in retail sector dynamics (14:20)
    • Discussion on the concept of skill premium and technological advancements (24:55)
    • Artificial intelligence’s influence on market dynamics and job skills (26:10)
    • Examining the pace and implications of innovation diffusion (31:00)
    • Regulatory challenges and tech dominance in the market (34:10)
    • Concentration of innovation and its economic implications (36:20)
    • James’ book recommendations (43:10)
    • And much more!

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    31 May 2024, 8:00 am
  • 48 minutes 46 seconds
    Jan Hummel - Deep Diligence at Paradigm Capital

    In this episode, Tano Santos sits down with Jan Hummel, CIO of Paradigm Capital, revisiting his investment strategies and exploring the nuanced dimensions of risk management in the evolving European asset landscape. Jan discusses the foundational investment philosophy of Paradigm Capital, emphasizing risk minimization and the strategic deployment of assets across Europe. Key discussions pivot around the firm's selective investment criteria, focusing on companies in the small to mid-cap space and the significance of geographical and cultural nuances in their investment decisions. This conversation offers listeners insights into the subtleties of value investing, portfolio construction, the implications of geopolitical and economic dynamics on market opportunities, and so much more!

     

    Key Topics:

    • Introduction and background of Jan Hummel (0:37)
    • Fundamental tenets of investment philosophy at Paradigm Capital (1:25)
    • The impact of European market dynamics on investment strategies (7:25)
    • Sourcing and valuing investment opportunities (9:47)
    • Specific approaches to risk management and hedging strategies (22:23)
    • Portfolio sizing and the decision-making process behind exiting investments (26:00)
    • The role of geographical focus in Paradigm's investment strategy (29:12)
    • Valuation techniques and practical applications in portfolio management (32:03)
    • Trends and challenges in the European asset management industry (36:48)
    • Macro-economic factors influencing market conditions and investment decisions (40:30)
    • Prospects for growth and opportunities in the European financial landscape (45:17)
    • Jan’s book recommendations (46:06)
    • And much more!

     

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    17 May 2024, 8:00 am
  • 27 minutes 12 seconds
    Todd Combs - Charlie Munger's Legacy

    In this heartfelt episode, we pay tribute to Charlie Munger, the visionary vice chairman of Berkshire Hathaway who recently passed away. Joining us is Todd Combs, an investment officer at Berkshire Hathaway and a close acquaintance of Munger. Todd shares personal anecdotes and insights into Munger's profound influence on the investment world and his unique approach to life and business. From his early meetings with Munger to the invaluable lessons on value investing and rational thinking, Todd provides an intimate look into the wisdom of one of the greatest investors of our time.

     

     

    Key Topics:

    • Celebrating Charlie Munger’s contributions and legacy (01:20)
    • Todd’s initial encounters with Munger (02:15)
    • The intellectual journey and partnership between Munger and Buffett (08:57)
    • Munger's approach to life, investing, and the importance of mental models (11:22)
    • Behavioral economics insights shared by Munger (13:00)
    • The practical applications of Munger’s wisdom in business and investing (16:17)
    • Munger’s lasting impact (24:59)
    • And much more!

     

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    3 May 2024, 8:00 am
  • 1 hour 3 minutes
    Kim Lew - The Dynamics of Risk Management and Asset Allocation

    Today's discussion with Kim Lew, President and CEO of the Columbia Investment Management Company, traverses her unique journey from her roots in the Bronx to managing a prominent Ivy League endowment. Kim shares her insights on navigating the intricate world of investment management, particularly in risk management and asset allocation. With a career marked by pivotal roles at entities like the Ford Foundation and Carnegie Corporation, her expertise brings a nuanced understanding of the interplay between market dynamics and organizational strategy. This episode explores how adaptability, intellectual curiosity, and understanding global trends shape successful investment approaches.

     

    Key Topics:

    • Kim's early career and transition to finance (2:59)
    • Role at Chemical Bank and career progression (5:05)
    • Experience at Prudential Capital and Ford Foundation (9:27)
    • Shift to Carnegie Corporation and Columbia Investment Management (18:07)
    • Challenges of managing a larger endowment (20:13)
    • Aligning endowment goals with university values and ESG considerations (22:08)
    • Comprehensive approach to risk management (26:54)
    • Asset allocation and balancing public vs. private markets (34:06)
    • The concept of future-proofing investment strategies (41:19)
    • Organizational behavior in asset management (48:54)
    • Importance of intellectual curiosity in team members (55:11)
    • Kim’s book recommendations (1:01:01)
    • And much more!

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    29 December 2023, 9:00 am
  • 51 minutes 35 seconds
    John Armitage - Navigating Macroeconomic Shifts

    In the complex world of financial markets and economic fluctuations, John Armitage, a seasoned investment maestro, sits down with us today. As the chief strategist behind the success of Egerton Capital, Armitage brings his profound insights into navigating the complexities of portfolio management and the subtle art of risk-taking in fluctuating markets. His expertise, honed through years of experience, sheds light on the critical impact of macroeconomic shifts and the pitfalls that stock pickers often encounter amidst outdated corporate data. This episode delves into passive investing, dissecting the crucial role of competitive dynamics in sectors like European aviation and examining the transformative impact of a growing talent pool on the traditional realms of asset management. Armitage also ventures into the ethical crossroads, intertwining moral integrity, societal upheaval, and the revolutionary wave of artificial intelligence. We uncover his focus on growth, governance, and quality, underpinned by a meticulous decision-making process at Egerton Capital, his literary pursuits, pondering over the influence of literature on his investment philosophy, and so much more!

     

     

    Key Topics:

    • Overview of Egerton Capital (1:42)
    • Transitioning from broad ideas to specific investments and the role of specialization (8:29)
    • Egerton Capital’s approach to researching new investment opportunities (12:58)
    • Understanding market signals and opposing investment perspectives (15:46)
    • John’s approach to portfolio building and decision-making in investing (20:00)
    • Client importance, portfolio building, and decision-making in investing (23:37)
    • Luck, being in the right place at the right time, and mentorship (28:07)
    • Managing portfolio volatility and the frequency of financial crises (30:54)
    • John’s positive outlook on reinsurance space and companies like Ryanair and Meta (35:31)
    • The future of stock picking and asset management (41:19)
    • What worries John and excites him about the future (43:09)
    • John’s book recommendations (45:29)
    • And much more!

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    15 December 2023, 9:00 am
  • 44 minutes 45 seconds
    Nicolai Tangen - Decision-Making and Intuition in Investing

    In the intricate dance of market movements and economic trends, it takes a discerning eye to discern patterns and make strategic decisions. Enter Nicolai Tangen, the astute CEO of Norges Bank Investment Management, who joins hosts Michael Mauboussin and Tano Santos on Value Investing with Legends. A connoisseur of art history and asset management, Nicolai offers a rare blend of expertise, drawing parallels between the seemingly disparate worlds of art and investment. His approach, marked by a blend of rigorous analysis and intuitive pattern recognition, reveals the underpinnings of a global economy shrouded in paranoia and driven by innovation. In this episode, Nicolai unfolds his journey from being an art student to leading one of the most prominent investment funds, highlighting how understanding historical context informs risk appetite. He brings to the forefront the role of AI in transforming investment strategies and the delicate balance of managing a substantial portfolio while maintaining a contrarian stance. Tune in to learn about the psychological aspects of risk assessment, the implications of AI on future investment strategies, the value of contrarian thinking in an ever-changing market, and so much more!

     

     

    Key Topics:

    • Nicolai's journey from Russian military studies to financial expertise at Wharton (2:45)
    • Nicolai's foundational career experiences with John Armitage at Egerton Capital (4:04)
    • The refreshing and insightful sabbatical Nicolai took to study art history (6:42)
    • AKO Capital's strategy: selecting high-quality stocks for robust growth and solid returns (9:17)
    • Investing success through deep reading, contemplative analysis, and rare decisive action (10:34)
    • The critical role of pattern recognition in navigating financial uncertainties (13:51)
    • Post-mortem analysis as a vital component of investment strategy refinement (15:41)
    • The importance of contrarian perspectives in investment strategy and team development (19:09)
    • Delving into CEOs' insights on market trends and the underestimated influence of corporate culture (23:04)
    • Adapting from selecting individual assets to managing broad asset classes with team collaboration (26:48)
    • Proactive engagement in corporate governance through ESG-focused voting practices (30:33)
    • The inescapable responsibility of managing a globally influential investment fund (33:08)
    • Balancing the promising prospects of AI with the imperative of managing social risks (35:36)
    • Defining fund success beyond returns: robust processes and a motivated, fulfilled team (38:07)
    • What keeps Nicolai up at night and excited about the future (40:40)
    • Nicolai’s book recommendations (43:24)
    • And much more!

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    24 November 2023, 9:00 am
  • 1 hour 14 seconds
    John Rogers - The Power of Patience

    John Rogers isn't just a successful investor; he's an industry titan. As the founder of a reputable investment firm, he's made a name for himself with his contrarian value investing strategies. But he's not just a practitioner; he's an educator, avidly reading and contributing to seminal works in investment literature. John’s journey began with an early fascination for finance from his youthful days. A Princeton alumnus, he entered the turbulent waters of the stock market and turned a calamity—the infamous crash of 1987—into a career-defining opportunity. In today's episode, John joins us to discuss his formative experiences, the philosophical underpinning of his investment strategy, and the importance of thinking long-term. We also delve into his roles on various corporate boards, where he weighs in on 401k plans, corporate governance, the pivotal role of diversity in creating equal opportunities for minority businesses, and so much more!

     

     

    Key Topics:

    • An overview of John’s professional background (2:15)
    • John's journey from William Blair to founding Ariel Investments (07:42)
    • The 1987 market crash as a turning point for Ariel's value investing approach (10:04)
    • John's philosophy on patient, research-heavy, value-based investing (13:07)
    • How longevity in markets solidified John's faith in efficiency (19:15)
    • The mechanics of idea generation at Ariel Investments (23:30)
    • Ariel's methodology for dissecting investment errors (29:53)
    • Drawing teamwork and pressure-handling lessons from Coach Carril (35:20)
    • How board experience informs his investing (37:47)
    • John's focus on value investing and cautious approach to buybacks (42:20)
    • Why John is optimistic about The Sphere in Las Vegas and Adelum (46:18)
    • John's fulfillment from social engagement and its business impact (50:18)
    • What keeps John up at night and excited about the future (55:48)
    • John’s book recommendations (57:41)
    • And much more!

     

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    10 November 2023, 9:00 am
  • 1 hour 2 minutes
    Sheldon Stone - Liquidity, Covenants, and Capital Availability

    Navigating the investment world is an enormous task, especially when looking at company numbers and the people running them. That's why we're thrilled to have Sheldon Stone on the show. Sheldon was the first in his family to go to college, attending the highly respected Bowdoin College. He was part of a remarkable class of 225 students, an experience that shaped his unique perspective on life and career. Hailing from New Jersey, Sheldon Stone has had a fascinating career journey. His time at Bowdoin wasn't just about hitting the books; it also laid the groundwork for his expertise in bonds and financial markets. In today's episode, hosts Michael Mauboussin and Tano Santos sit down with Sheldon to dig into the nuts and bolts of investing. Sheldon shares his path from studying government in college to becoming a seasoned Chief Investment Officer. We dive deep into critical considerations like balancing liquidity and safeguarding investments, understanding the growing high-yield market, and why intangible assets like brands and patents are making financial waves. Sheldon, Michael, and Tano will explore Sheldon's unique educational background, the trade-offs in investment strategies, the rise of the high-yield market, the role intangibles play in today's financial world, and so much more!

     

     

    Key Topics:

    • An overview of Sheldon’s professional background (3:13)
    • 40-year partnership with Howard Marks: mutual dynamics and shared intellect (8:38)
    • Early high-yield bond market inefficiencies and technological limitations (11:23)
    • How equity holders' approach affects creditor relations and company ease-of-work (18:57)
    • Company growth via flexibility over ratings and the role of private equity (20:38)
    • Operating in 300-550 basis point spreads; equity investment opportunities (24:18)
    • Importance of new issues for returns; market appetite and deal quality (26:25)
    • Role of equity market signals in bond investments; sector focus (28:34)
    • Credit scoring matrix: eight critical factors for buy/sell decisions (31:17)
    • Asset recovery rates: tangible vs intangible; market sentiment effects (39:25)
    • Impact of rising rates on leveraged loans; stability measures (46:55)
    • Challenges with interpreting delinquency rates; sector diversification strategies (50:30)
    • Characteristics of influential investment committees: camaraderie and vital CIO (52:04)
    • Teaching at Columbia; credit analysis as a career path for students (54:12)
    • What keeps Sheldon up at night and excited about the future (57:14)
    • Sheldon’s book and theatre recommendations (59:00)
    • And much more!

     

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    27 October 2023, 8:00 am
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