The Quant Approach to Innovative Investing

03/11/21 • 71 min

Is gold just another "greater fool" investment?

Warren Buffett seems to think so. Or at least, he's said as much in his 2011 letter to investors, when he compared gold to the tulip bulb mania.

On this week's rant, Dan examines this point of view and explains what Buffett doesn't seem to grasp when it comes to gold...

Then on this week's interview, Dan invites Gregg Fisher onto the show. Gregg is the founder and portfolio manager of Quent Capital, an asset management firm focused on systematically investing in global innovation.

Many guests on the show fell in love with finance and investing later in life... but that's not the case with Gregg. Gregg was born into the investment business and well on his way by the time he was a teenager. By the time he left college, Gregg helped pioneer some of the quant trading strategies that are so common in the industry today.

During their discussion, Gregg explains why so many small innovative companies are often overlooked. But he stresses that if you're willing to do a little extra leg work, many innovative small caps present a massive opportunity.

By the time the interview is over, Dan is left questioning if he has enough money in small cap stocks.

Then on the mailbag, Dan fields several questions from listeners about gold, including one listener who gives a fantastic real-world demonstration of gold's long term value. Another listener writes in and shares a story of remorse for selling his Bitcoin a little too soon. Dan gives him some words of wisdom and reassures him that "we've all been there."

Listen to Dan's response to these questions and more on this week's episode.

Is gold just another "greater fool" investment?

Warren Buffett seems to think so. Or at least, he's said as much in his 2011 letter to investors, when he compared gold to the tulip bulb mania.

On this week's rant, Dan examines this point of view and explains what Buffett doesn't seem to grasp when it comes to gold...

By the time the interview is over, Dan is left questioning if he has enough money in small cap stocks.

Listen to Dan's response to these questions and more on this week's episode.

Previous Episode

Small Caps with Exponential Growth

It’s not the sexiest part of the market, but Dan decides to break down bonds.

If you look at the benchmark ten-year bond treasury yield, it has tripled since last year. Does this mean the bond rally is over and we’ve topped out at the bond market? Or is inflation finally kicking in as yields climb?

Bond interest rates are the lowest they’ve been since there’s been data for this, and if the Fed keeps trying to stabilize and suppress rates, printing endless cash and buying new government debt, the more dire the economic consequences will be. They should just let the market adjust naturally, or we’ll have 2008 all over again.

Dan’s guest this week is Chris Retzler, a portfolio manager at a small-cap growth-fund for Needham Funds Asset Management. His fund thrived during the bear-market bottom, nearly doubling. Retzler’s forte focuses on nurturing long-term relationships with his portfolio companies’ management teams and seeking out undiscovered investment opportunities.

The appeal of small-cap stocks is the room for growth along with a more potent potential for gains -- but how does Retzler make his market picks? His fund has succeeded during the pandemic (Moderna is in their portfolio), but what exactly are the best small-cap markers?

It appears getting acquainted with management is a vital first step in investing with emerging small-cap companies. To be a concentrated investor, you have to know with whom you're investing. Regarding small-cap tech opportunities, look for capital-intensive companies that don’t have a lot of competition in the same space, e.g., semiconductor makers. And he highlights telemedicine as a surging fertile investing ground for explosive growth.

Oh, and always follow Warren Buffet’s four basic tenets of investing.

Listen to their conversation and much more on this week’s episode, including mailbag questions that cover everything from aluminum to acquisitions.

Also, check out a new episode of Stansberry’s podcast where politics and economics meet, American Consequences with Trish Regan.

Next Episode

Quantamental Investing Lessons with Jason Hsu

One year ago today, Bitcoin traded for around $5,200...

Today, it's hovering around $58,000...

When one of your investments has grown to a massive winner, what's the next step?

It's a tough question that every investor needs to face on their own. But on this week's rant Dan looks back to the story of Robert Kirby and the coffee can portfolio, which suggests sometimes the best thing to do... is nothing at all.

Then on this week's interview, Dan invites Jason Hsu onto the show. Jason is Chairman and CIO of Rayliant, an asset manager who focuses on generating alpha from investing in China and other inefficient emerging markets.

Some asset managers tend to lean towards a quantitative approach... Some use a fundamental approach...

Jason shares how Rayliant has blended the two into one in order to take advantage of the massive opportunity in China and other emerging markets.

During their discussion, Dan and Jason discuss the massive opportunity in China today... how the Chinese government's hands-on approach differs from the U.S. government's way of doing things... and how his firm is making it easier than ever for investors to gain exposure to emerging markets around the globe that are often overlooked.

Then on the mailbag, Dan answers your questions, comments and politely-worded criticisms. But this week, there's only one big question that Dan wants to focus on... It's one that many investors – retail and institutional alike – have been wondering.

Is it better to buy Bitcoin outright or are Bitcoin ETFs, like GBTC, a suitable way to gain exposure?

Listen to Dan's take on this popular question and more on this week's episode.