Key insights
- The author questions the over-reliance on quantitative metrics in stock selection, arguing that management's reputation and ability to foster long-term relationships are crucial, especially in tech and biotech where partnerships are vital. This suggests a need to incorporate qualitative factors into investment decisions, potentially leading to more informed and resilient portfolios.
I’ve spent all week poring over P/E ratios and financials, but I think I’ve been doing it wrong so far. I mean, numbers are good and all that jazz, but if management sucks at making people happy in the long term, then forget it – the stock will crash anyway.
I was reading some stuff on how to build long-term trust in business by one guy, and it got me thinking that I don’t even look at relationship health in my due diligence process. Spreadsheets and charts all the way.
Do you guys look at the reputation of people in charge in stock selection, or is it entirely numbers-based for you? Especially in tech and biotech, where one bad partnership ruins the whole scene.