Tiger and its cubs
I’ve been an admirer of Julian Robertson ever since I first read about him in the Money Masters series. The eclectic investing style, the dynamic focus on fundamentals and the insane commitment he took with each position in his portfolio. The one (I believe) biography on Julian was written by Strachman. It’s a good introduction into his world. The most interesting insights, I believe, are about Julian’s demeanor, character and skill set.
The Man
Julian had an enormous appetite for competition and winning. Keeping score was a must with Julian and within the culture of Tiger. I like to think high finance is analogous to the olympics, where many compete to achieve high returns on invested capital while mitigating risk. The attraction to this business is the eclectic demeanor participants must have to achieve meaningful results. The positions investors take are guided according to how one sees the markets’ direction. Julian was a master at this. He was security agnostic, value oriented. The most important traits/skills he had were communication, sales, networking, fundamental analysis and deep and dirty hands on analysis of companies and prospective financial securities in his portfolio.
One of my favorite stories about Julian is his relentless pursuit of investment ideas. He was know to be a constant searcher for the best investments through his immediate network and elsewhere. He was in a constant state of motion. Robertson spent his days reading, analyzing charts and speaking on the phone. As an investor, the most important thing you can do is find potential investments, conduct quality research and take a position in the appropriate security for the best risk/reward.
The most impactful strategy Julian practiced was the hiring and retaining of human capital. Robertson’s belief that maximum efficiency comes from the free flowing quality ideas to replace outdated positions within his portfolio. This alone should be implemented in any organization striving to compete in a competitive environment. Often times, old ideas and beliefs hold companies back from making meaning shareholder value.
Constantly developing nodes in one’s network is the best way to build organic funnels of ideas and investments. Julian did this better than anyone. This is something that can be implemented quite easily by reaching out to anyone you find interesting or whose perspective in a given field is meaningful. Alix Pasquet III has an interesting tactic in reaching out to prospective nodes in one’s network. I would watch his interview with Neckar’s Mind.
The Cubs: Being a Tiger
In the chapter, The Tiger Tangles with the Press, there’s a brief section describing an ideal analyst at Tiger. These are the traits that all Julian’s cubs like Andreas Halvorsen, Chase Coleman, John Griffin and more have in spades:
Smart, bright, and quick with functional intelligence.
Strong sense of ethics.
Background in sports and interest in physical fitness.
Interest in charity and public welfare.
Sense of humor and fun to be around.
Good resume.
The firm was known to have a no rank hierarchy where analysts and PMs talked with each other openly. In fact, exchange of ideas was a requirement at Tiger. Bull/Bear debates were held in Julian’s office to stress ideas either long or short. The attention to detail and rigorous study of one’s idea was required before a position was taken in the portfolio.
Big Lessons
There are common traits we see among the world’s most successful in business and investing. Competitive, detail oriented, intelligent and curious are just a few adjectives we could use to describe these investors.
What were the key habits, behaviors and traits of Julian and his Cubs that produced one of the greatest investment firms in history?
Constantly developing networks in order to extract information and insight for future investments.
Being an eclectic investor, agnostic to asset classes and securities. You should be comfortable expressing investment ideas with a wide range of securities.
Sales and marketing. Nothing is more important than sales in the context of raising investment, attracting talent and marketing your services. Tiger Management was one of the most successful funds when it came to raising capital. A lot of this had to do with Julian’s sales background. Become a salesman.
Detailed fundamental analysis with a boots on the ground approach. Understanding the DNA of a company, its management, its products or services was just the beginning of a Tiger’s investment diligence process. Just as important was meeting the management, kicking the tires, speaking with former and current management, employees and vendors.
Julian’s investment process was talking to stakeholders, reading reports and analyzing price movements of securities. Reading industry reports, annual reports, corporate filings, economic data and analyzing price movements and sentiment was Tiger Management’s playbook. They incorporated fundamental analysis and technical analysis (with respect to charting) throughout an idea.
Responsibility, accountability and appearance. A tiger was someone who took pride in their appearance by attention to their dress and impressions. A tiger was someone who took full responsibility for their lives, their decisions and their returns.
Garner the reputation as someone who can gather information, process it and figure out the best course or decision to take in business and in life.
These are my 7 lessons from A Tiger in the Land of Bulls and Bears.
Thanks for reading.