Investment Community #8

Sean Peche, PM and founder of Ranmore Fund Management, was my special guest on the Investment Community podcast.

In this episode, Sean tells:

* Why it’s important to be careful about stock stories. The stock price changes long before the story does, and by the time the story changes, you’ve lost your money.

* How value managers are just as prone as growth managers to falling prey to false narratives about stocks and markets.

* How there’s a lack of evidence that larger investment teams deliver better investment performance than smaller teams.

We also discussed:

* The challenge for active managers to convince their clients that their management fee is good value compared to the fees charged by passives.

* Whether performance fees incentivise fund managers to perform better, or whether these fees simply induce them to take more risk.

* The possibility of a backlash against performance fees, and especially against fund managers’ attempts to reset their high water marks.

Sean Peche is PM and founder of Ranmore Fund Management. Sean’s investment career began in South Africa in 1997 when he joined Old Mutual Asset Management as an equity analyst. In 1999 he joined Decillion Capital as one of its founding members and co-managed their successful BigRock Fund, a South African-based hedge fund. In 2001 he relocated to London with Decillion Fund Management and co-managed a US/European hedge fund. In 2003 he joined London-based Orbis Investment Advisory, before leaving in 2008 to establish Ranmore Fund Management.

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