INVESTING GENERALIST

“See a lot, be a generalist. Be security agnostic." Andy Redleaf

“We consider our lack of formal industry specialisation a strength.   Without a dedicated retail specialist, for example, we’re less obliged to invest in retail businesses if opportunities seem scarce.” Vinson Walden

“The benefit of being a global generalist is that we’re not forced to do anything. We just need to find the best ideas from a wide universe.”  Ed Bosek

“We think more value is added by being generalists and seeing opportunities from a broader perspective. If you have silos, you’re going to own things only within those silos. If you have the broader perspective, you can say, “I don’t even like stocks, I’m working on distressed debt,” or something like that.”   Seth Klarman

"There's a certain trade-off with having very narrow expertise. If one focuses on just a very small number of names they can develop a deep understanding of certain companies but may lose perspective of how that opportunity set compares to a broader universe.” Lee Ainslee

“One of the reason of my success was open mindedness to various asset classes. It gives you the discipline to not play when you shouldn’t be playing. If you looks at bonds, currency, equities and commodities, if you are involved in a whole bunch of different asset buckets and open-minded you tend to only play when you should.”  Stanley Druckenmiller

"It is a first principle at Whitebox to be "security agnostic": to penetrate the labels like "bond" and "stock" and "hybrid" and assess the real status of a security by the risks and rewards that flow from the combination of economic circumstances and the details of capital structure."  Andy Redleaf

“We’re generalists, but we need to find the non-Wall Street people who have lived and breathed and suffered in the industries and business we’re now looking at.” Bruce Berkowitz

“Our analysts are generalists. The problem with specialising in sectors is that you tend not to have your eyes open to other sectors.” William von Mueffling

“The successful businessman is no narrow specialist.”   J Paul Getty

“We are global generalists and think the best way to invest is to generate ideas as generalist.” Ed Bosek

"I came from the school of thought where we are all generalists. I think that's a huge advantage...  We still use a generalist model. We need to go figure out what ponds we're going to fish in. I believe that 80% of the game is figuring out what to work on. We've created our firm to be very good at figuring out what to work on."  John Phelan

"Like Baskin Robbins ice cream, opportunities come in dozens of flavours, not all of which are served at the same time.  Investors who find an overly narrow niche to inhabit prosper for a time but usually stagnate.  Those who move on when the world changes at least have the chance to adapt successfully."  Seth Klarman

"Industry specialists are prone to taking the “inside view.” Having got lost in a thicket of detail, industry specialists end up not seeing the wood for the trees. They may, for instance, spend too much time comparing the performance and prospects of companies within their sector and fail to recognize, as a result, the risks that the industry as a whole is running. Marathon prefers to employ generalists who are less likely to suffer from “reference group neglect” and better able to employ an understanding of capital cycle dynamics across industries" Edward Chancellor

"Having insight into only one market is likely not going to be sufficient" Seth Klarman

"I also believe that the more businesses you look at and can compare the better investor you will become. This is why we like the generalist versus specialist model. We are confident we can get to 80% - 85% of the knowledge base any specialist has. We can go buy the other 15%. We can go hire a consultant or whatever we need to get up to speed." John Phelan

"We think the best way to do it is to have a generalist culture across industries, across strategies, and - to a lesser extent - across geographies"  Larry Robbins

"[Our] investment team utilizes a generalist approach within a consistent framework of what makes for a good and potentially investable business." Jeffrey Ubben

"In my view, there is far greater danger to over-specialisation than over-generalisation" Robert Vinali

"We've never defined ourselves as one kind of firm and we've never really deviated from that kind of flexibly approach.  Instead, we've deepened our research process and hired people who have brought us expertise in different geographies, different industries and different asset classes.  Our philosophy is to be opportunistic all the way across the capital structure from debt to equity, across industries and different geographies" Dan Loeb

"We are not constrained by geography, sector, industry, or market capitalization" Lou Simpson

"One big advantage is we don’t think of ourselves as one industry, like department store guys, steel guys or tyre guys.  We thought of ourselves as having capital to allocate.  If you start with a given industry focus and you spend your whole time to make a better tyre, or whatever, it's hard to have the flexibility of mind, that you have if you just think you have a large growing pile of capital and trying to figure out what is the next best move you can make with that capital.  I think we have a real advantage that way." Warren Buffett

"Our approach is opportunistic in the sense that I don't have a particular top down approach to saying that I want to go into this asset class or this type of market cap or this type of industry or any of those things.  I am completely wide open on that" Mohnish Pabrai

"We have no restrictive stipulations, such as market-cap size, sector weightings, or other common industry handcuffs. We simply look for compelling opportunities that inspire conviction, which is driven by clear understanding and a vacancy of major risks." Allan Mecham

"Remain flexible and open-minded about types of investments.  There are times to buy blue chip stocks, cyclical stocks, corporate bonds, US Treasury instruments, and so on.  And there are times to sit on cash, because sometimes cash enables you to take advantage of investment opportunities.  The fact is there is no type of investment that is always best.  If a particular industry or type of security becomes popular with investors, that popularity will always prove temporary and - when lost - may not return for years"  Sir John Templeton

"We try not to limit ourselves.  It's a big world out there, and at any given time certain industries are going to be in and out of favour and regions are going to be in and out of favour, and so by restricting yourself I think you're restricting yourself"  Jim Chanos

“I’ve never wanted to limit myself by things like business model, industry, cap size or geography.  Those distinctions strike me as somewhat artificial and are limiting in a world where great opportunities can be anywhere and are constantly changing”  Chris Mittleman

"One truth or archaeology in particular bear directly on my thinking.  Archaeologists have their specialties, and one of the curiosities of the field is that those who specialise in one aspect of antiquity tend to be blind to anything else.  Archaeologists who look for pottery sherds will not see coins, and, conversely, those who look for coins will not find sherds.  Same dig, but those sifting the soils see entirely different things. So it is with markets." Leon Levy

"A specialist likes ideas in a sector but that doesn’t mean they're good investments. What you want in the portfolio is not the best coal company, you want the best stocks.” Mohnish Pabrai

"By specializing in just one industry, analysts are prone to be surprised by developments outside their focus, just as, say, the Swiss watch industry was unprepared for developments in the semi-conductor field. Predictions are often in error not as to what is analyzed, but as to what is not taken into account" Bennett Goodspeed

"I am industry agnostic. I move in and out of real estate, manufacturing, pharmaceuticals, logistics, energy, and a bunch of other industries. I am opportunistic. Sometimes I am a buyer, sometimes a seller. Sometimes an equity investor, and sometimes I focus on debt. Often both. I never let my affinity for any one industry or my love of doing deals dictate my actions" Sam Zell

“I have no prejudice, no bias. I’ll buy companies with unions, I’ll buy companies that aren’t growing, I’ll buy companies that are airlines, that are insurance companies or banks. I’m a little scared of  technology companies as they are a little bit beyond my realm. But I have bought a couple of biotech companies I can understand. I’ll look at anything, I have a very big horizon. If you look at 10 companies one’s probably a bargain, it’s mispriced. If you look at 20 there will be 2. If you look at 100 you’ll find 10. So the person who turns over the most rocks wins” Peter Lynch