By Drew Dickson of Albert Bridge Capital
On first principles, there is one way to generate excess stock market returns over the long term, and it isn’t to “own winners at any price.”
Sure, in hindsight it was, but that is very convenient. It’s very convenient to now ignore the stocks we thought were winners, but weren’t. It’s also very convenient to draw parallels between past winners and newer companies as if it is a foregone conclusion they too will win in similar fashion. Not everyone can be Amazon, in fact, no one else may ever be Amazon.
Nor do excess returns come from “owning good companies at any price” or “owning high-quality companies at any price.” The “one way” to outperform is to buy….. read more