Good reads from around the Web.
I was sad to learn this week that Jim Slater has died [1], aged 86.
Slater was a fixture of the UK’s investing landscape for more than five decades. That landscape is the poorer without him.
Unlike the US where the likes of Peter Lynch [2]
The very successful contrarian investor Antony Bolton did publish a book [4]
I guess Neil Woodford is more chatty nowadays, via his newish company’s blog [5].
But income investing’s Billion Pound Man will have to live to 300 to outdo Slater’s output at his current word rate.
Most of our top active investors are unknown hedge fund billionaires who barely leave the City except to helicopter to their estates in the Home Counties or to attend society weddings in the South of France.
I don’t get the impression they’re interested in sharing with the rest of us.
Investing made accessible
In contrast, Jim Slater was unique, and to me uniquely inspiring.
Slater was a self-made man back when The City was still dominated by old school ties, and he was systematic about his stockpicking when the culture was still to buy on tips from those supposedly ‘in the know’.
He began sharing his investing thoughts way back in the 1960s.
But most UK private investors today know him from his famous bible for picking growth stocks, The Zulu Principle [6]
In the periods when its kind of companies are in fashion, Slater’s Zulu method works almost like magic. It’s therefore created a fair few vocal disciples who’ve done well in those good times – not least his own son, Mark, who runs a fund [7] based on its principles.
I’m not ashamed to say however that my introduction to Jim Slater’s thinking – and pretty much to investing – was his much less sexy Investment Made Easy [8]
I still have my battered old copy, which I dusted down for a photoshoot:
[9]A book that changed my life.
For me Investment Made Easy was a sort of Hitchhiker’s Guide to an amazing new world.
Slater explained everything from inflation and bank accounts to funds, shares, investing ratios, and even the pros and cons of home ownership.
I even re-read the book 20 years later for inspiration when I began my own short series on investing for beginners [10].
I’ve also referred more than once to his thoughts on spotting bull market tops [11] and bear market bottoms [12], which to me as an active investor [13] are much more insightful than any number of data-mined numerical indicators.
If only I’d followed Slater’s stern advice given in the mid-1990s that nobody can afford to ignore the huge tax advantages of owning their own home in the UK!
Slater convinced me, but events and a decade later poor judgement intervened.
But the point is: How many stockpicking gurus have you read that tell you to first go buy a house?
Slater was practical, and he had the common touch, despite his extraordinary career.
Fluctuat nec mergitur1 [14]
Incidentally, I was surprised to read [15] that popular investing blogger Paul Scott had no idea of Slater’s boom-to-bust business career of the ’60s and ’70s.
Like me, Scott was a denizen of the Motley Fool bulletin boards a decade ago when they were in full health, and there was a time when you couldn’t mention Slater on there without someone harping on about his past – invariably in an unflattering light.
Slater was one of the original corporate restructurers – the sort that would later be disparaged (by some) as asset strippers.
In the 1970s he was as famous as any City figure is today for that, not for his stock picking prowess.
The business ultimately blew-up – as so many of that ilk do – on the back of excessive debt. There was also a suggestion of scandal that was thrown out, but which some of those old hands on the Fool boards still remembered.
By the way, Slater didn’t seem to lose his appetite for risky borrowing. Investment Made Easy was later reworked [16]
I remember thinking at the time it seemed ultra-risky. But that time was 2001 or 2002, and I daresay his strategy minted a few millionaires among its readership.
Passionate even at 80
I met Slater – well, to shake his hand and say I enjoyed his books – a few years ago.
It was at a conference for private investors. They loved him, and he seemed at one with them.
At the Q&A at the end of his session people shouted out small cap names to ask for his opinion, and the bright 80-something knew them all. (Another inspiring old super-successful investor [17]!)
Slater was getting into gold miners at the time. I hope he got out again.
I’ve also met his son, Mark, the aforementioned fund manager, and enjoyed a more substantial conversation. The physical resemblance is uncanny, and Mark also follows the Zulu principles.
I found him a different sort of personality to his father, but I’d certainly be very interested in a book, were Mark to take on his mantle.
My condolences to him and to the rest of the Slater family.
From the blogs
Making good use of the things that we find…
Passive investing
- UK investors are decades behind US [Video] – T.E.B.I. [18]
- ETFs explained – The Escape Artist [19]
- 5 things Smart Beta won’t do for you – The Reformed Broker [20]
- ‘Fading affect bias’ and bear markets – Bason Asset Manangement [21]
Active investing
- Making predictions is easy. Managing money is hard – AWOCS [22]
- What the $*@£ is wrong with Rolls-Royce? – Richard Beddard [23]
- Dying unicorns – Investing Caffeine [24]
- Strive to be good if you want to be great – The Reformed Broker [25]
- Is your smartphone killing your returns? – Abnormal Returns [26]
- Imperial Tobacco’s debt-fueled dividend growth – UK Value Investor [27]
Other articles
- Understanding bond duration and risk – Vanguard [28]
- Focus, festivity, and flow – Mr Money Mustache [29]
- How to deal with Christmas expenses – Simple Living in Suffolk [30]
- Cutting the cords and saving… a bundle! – SexHealthMoneyDeath [31]
- Cute observation on market noise [Tweet] – Morgan Housel [32]
Product of the week: The Telegraph [33] has surveyed the landscape and put Secure Trust Bank [34] back at the top of the Best Buys for savings, with its new 120-day notice account paying 1.91%.
Mainstream media money
Some links are Google search results – in PC/desktop view these enable you to click through to read the piece without being a paid subscriber of that site.2 [35]
Passive investing
- Where Vanguard goes, fees fall – MarketWatch [36]
- Why stockpickers tend to underperform: Maths edition – Bloomberg [37]
- Swedroe: Putting valuation metrics in perspective – ETF.com [38]
Active investing
- Three lessons from Yale’s endowment portfolio – Morningstar [39]
- Has the share buyback boom undermined long-term growth? – Reuters [40]
- …especially in the face of asset-light giants like Facebook? – Telegraph [41]
- Why Nike should buy Lululemon Athletica – Bloomberg [42]
- Meet a one-man venture capital band – TechCrunch [43]
- 10 high conviction ideas from top US stock pickers – Morningstar [44]
- Could supermarkets be the next big dividend payers? – ThisIsMoney [45]
Other stuff worth reading
- Fund costs and charges are designed to confuse [Search result] – FT [46]
- Will George Osborne raise CGT next week? – ThisIsMoney [47]
- The first study of crowdfunding’s winners and losers – Telegraph [48]
- Why the booze cruise to Calais is back on – Guardian [49]
- Tory think tank agrees foreign flat buying needs curbing – Guardian [50]
- An interview with Ben Bernanke [Podcast] – Wall Street Week [51]
Book of the week: Good news for Martin Ford, bad news for humans – the author’s Rise of the Robots [52]
Like these links? Subscribe [53] to get them every week!
- ‘Tossed but not sunk’ – the motto of the indestructibly beautiful city of Paris. [↩ [57]]
- Note some articles can only be accessed through the search results if you’re using PC/desktop view (from mobile/tablet view they bring up the firewall/subscription page). To circumvent, switch your mobile browser to use the desktop view. On Chrome for Android: press the menu button followed by “Request Desktop Site”. [↩ [58]]