Comments on: Global Market Trends and The Microcap Benefactors

By: Ian Cassel

Ian Cassel — Sun, 06 May 2012 21:58:33 +0000

Googie: I’m an economics major by education, but find it not that useful in investing (or useful in anything really . The only way I’ve found “economics” useful in picking a trend would be the lack of monetary fiscal restraint by the US feeding (dollar printing) the Gold-Silver/precious metal stocks over the last decade. But I’m mostly out of that trade outside of some bullion. I’m mainly focused on bullish macro trends with few (hopefully one) micro cap participants. These trends tend to mostly be in technology/biotech. How do you first find the trend before everyone else? Well I should rephrase that question, How do you find the trends before the bulk of investors do? I am constantly researching, reading, etc. I outlined INMG as really the only participant in the food safety/transparency trend in our last radio program with Chris Lahiji. This doesn’t mean I think the stock will go to $1 tomorrow..these things take time to mature, and its why “timing” is always important. I’ve been wrong before and will be wrong again, but in most of those cases I was wrong with the timing. Then you hit one right with the timing like ZAGG (Smartphone, derivative of Apple) in the fall of 2008, and it goes up 10x in 9 months even during the greatest economic collapse since the great depression. So I guess that is a long answer in saying no I don’t pay that close of attention to economics or economic forecasts. I try to find scarce high growth rate companies with a huge tailwind (macro trend) that investors will always pay a premium for.

By: Googie

Googie — Sun, 06 May 2012 20:55:03 +0000

There was an interesting piece on Consuelo Mack’s PBS show this weekend related to investment philosophy. Keynes was a miserable investor through the 1920′s as he was trading in and out of the market based on his macroeconomic forecasts. He had macro-economic data that nobody else had based on his professional position. Evenso, he predicted miserably and was even fully invested going into the 1929 crash. Later he switched to a bottoms up philosophy focusing on undervalued small stocks. He was concerned more about the opportunities specific to that company and ignored macroeconomic forecasts. He racked up a terrific long-term record with average annual returns on the chart Consuelo showed that looked like around 18% annualized return. I personally ignore macro-economic forecasts not because macro-economics doesn’t matter but because I have no faith in macro-economic forecasts.

You try to identify global trends and find the micro-cap benefeciaries. Are you relying on macro-economic forecasts to identify the trends? Maybe you find trends that are more predictable?

By: Ian Cassel

Ian Cassel — Wed, 02 May 2012 14:15:52 +0000

Thanks David. Just like a lot of things easy in theory but hard to actually do it. I’m constantly searching for the big trend with few participants..really a crowd theory.

By: david

david — Wed, 02 May 2012 13:33:18 +0000

Excellent post Ian. I’ve picked up on this being a major investment strategy of yours but it’s nice to see examples.