The Idea Farm

Great chartbook by Apollo Global Management, Inc. on the tariff response. 𝗛𝗼𝘄 𝗮𝗿𝗲 𝗳𝗶𝗿𝗺𝘀 𝗿𝗲𝘀𝗽𝗼𝗻𝗱𝗶𝗻𝗴 𝘁𝗼 𝘁𝗮𝗿𝗶𝗳𝗳𝘀?  - Rapid downward revisions to earnings expectations - New orders falling, capex plans falling - Inventories rising before tariffs 𝗛𝗼𝘄 𝗮𝗿𝗲 𝗰𝗼𝗻𝘀𝘂𝗺𝗲𝗿𝘀 𝗿𝗲𝘀𝗽𝗼𝗻𝗱𝗶𝗻𝗴 𝘁𝗼 𝘁𝗮𝗿𝗶𝗳𝗳𝘀?  - Consumer confidence at record-low levels - Front-loading purchases before tariffs began - Tourism slowing, in particular international

🎙️ 𝗧𝗼𝗽 𝗜𝗻𝘃𝗲𝘀𝘁𝗶𝗻𝗴 𝗣𝗼𝗱𝗰𝗮𝘀𝘁𝘀 𝗼𝗳 𝘁𝗵𝗲 𝗪𝗲𝗲𝗸 🎙️ Joe Lonsdale with Peter Thiel on DOGE, tariffs, building generational companies & the future of civilization https://lnkd.in/gkhginfh Willy Walker with Dr. Peter Linneman on the state of the economy https://lnkd.in/gWT43ZRV Patrick Ceresna, CMT DMS CIM and Kevin Muir with Peter Haynes on index pre-positioning https://lnkd.in/g4k3h6FW

What if you bought the largest 10 stocks in the S&P 500 since 1980 & held them for 1-10 years? While the absolute returns are solid, the relative returns are generally negative, as other faster-growing companies come along and outperform. via Goldman Sachs

🎙️ 𝗧𝗼𝗽 𝗜𝗻𝘃𝗲𝘀𝘁𝗶𝗻𝗴 𝗣𝗼𝗱𝗰𝗮𝘀𝘁𝘀 𝗼𝗳 𝘁𝗵𝗲 𝗪𝗲𝗲𝗸 🎙️ Ted Seides with Alex Sacerdote on riding s-curves at Whale Rock https://lnkd.in/gUnBSaPd Matt Zeigler and Justin Carbonneau with Richard Bernstein on the market https://lnkd.in/g-vMZpxk Jack Farley with Lyn Alden on challenge America’s trade deficit, challenge the U.S. dollar https://lnkd.in/gaS3th4H

𝗧𝗵𝗲 𝗧𝗮𝘆𝗹𝗼𝗿 𝗦𝘄𝗶𝗳𝘁 𝗘𝗰𝗼𝗻𝗼𝗺𝘆 💃 The developed economy consumers’ shift from buying goods to having fun creates distortions in economic data. The growing importance of mega events can increase consumer price indices—without necessarily increasing consumers’ cost of living. Tickets for a Taylor Swift concert will often sell for high prices—but that may not be recorded in consumer price data. Paul Donovan, Chief Economist of UBS Global Wealth Management, explains this dynamic.

𝗪𝗵𝘆 𝗣𝗮𝘁𝗶𝗲𝗻𝗰𝗲 𝗠𝗮𝘁𝘁𝗲𝗿𝘀 𝗗𝘂𝗿𝗶𝗻𝗴 𝗠𝗮𝗿𝗸𝗲𝘁 𝗦𝘁𝗿𝗲𝘀𝘀 - Man Group 𝗞𝗲𝘆 𝗧𝗮𝗸𝗲𝗮𝘄𝗮𝘆𝘀: - In trend investing, patience is more than a virtue. History shows that holding your nerve during market crises can be financially rewarded. The ‘dot-com’ bust, the Global Financial Crisis (GFC) and the 2022 inflation episode all saw trend-following strategies lose before delivering substantial gains - Trend strategies often require time to adjust positioning and capitalise on emerging trends during market dislocations - Observing recurring patterns across crises can help investors adapt and generate ‘crisis alpha’ https://lnkd.in/eKd_h5cM

𝗖𝗼𝗻𝗰𝗲𝗻𝘁𝗿𝗮𝘁𝗲𝗱 𝗽𝗼𝗿𝘁𝗳𝗼𝗹𝗶𝗼 𝗺𝗮𝗻𝗮𝗴𝗲𝗿𝘀: 𝗖𝗼𝘂𝗿𝗮𝗴𝗲𝗼𝘂𝘀𝗹𝘆 𝗹𝗼𝘀𝗶𝗻𝗴 𝘆𝗼𝘂𝗿 𝗺𝗼𝗻𝗲𝘆 - Acadian Asset Management • There is little evidence that concentrated portfolios generate high alpha. • Concentrated portfolios are risky, generating huge drawdowns and massive wealth destruction. • The mistaken faith in concentration is driven by overconfident portfolio managers plus the pervasive failure to account for survivorship bias. 𝘠𝘰𝘶 𝘤𝘢𝘯𝘯𝘰𝘵 𝘭𝘰𝘰𝘬 𝘢𝘵 𝘢 𝘭𝘪𝘴𝘵 𝘰𝘧 𝘤𝘶𝘳𝘳𝘦𝘯𝘵𝘭𝘺 𝘸𝘦𝘢𝘭𝘵𝘩𝘺 𝘱𝘦𝘰𝘱𝘭𝘦 𝘢𝘯𝘥 𝘪𝘯𝘧𝘦𝘳 𝘵𝘩𝘢𝘵 𝘤𝘰𝘯𝘤𝘦𝘯𝘵𝘳𝘢𝘵𝘪𝘰𝘯 𝘪𝘴 𝘨𝘰𝘰𝘥. 𝘐𝘵’𝘴 𝘭𝘪𝘬𝘦 𝘭𝘰𝘰𝘬𝘪𝘯𝘨 𝘢𝘵 𝘢 𝘭𝘪𝘴𝘵 𝘰𝘧 𝘗𝘰𝘸𝘦𝘳𝘣𝘢𝘭𝘭 𝘸𝘪𝘯𝘯𝘦𝘳𝘴 𝘢𝘯𝘥 𝘤𝘰𝘯𝘤𝘭𝘶𝘥𝘪𝘯𝘨 𝘵𝘩𝘢𝘵 𝘗𝘰𝘸𝘦𝘳𝘣𝘢𝘭𝘭 𝘪𝘴 𝘢 𝘨𝘰𝘰𝘥 𝘪𝘯𝘷𝘦𝘴𝘵𝘮𝘦𝘯𝘵. 𝘠𝘰𝘶 𝘯𝘦𝘦𝘥 𝘵𝘰 𝘤𝘰𝘯𝘴𝘪𝘥𝘦𝘳 𝘸𝘩𝘰 𝘯𝘦𝘷𝘦𝘳 𝘮𝘢𝘥𝘦 𝘵𝘩𝘦 𝘭𝘪𝘴𝘵, 𝘢𝘯𝘥 𝘸𝘩𝘰’𝘴 𝘣𝘦𝘦𝘯 𝘬𝘪𝘤𝘬𝘦𝘥 𝘰𝘧𝘧 𝘪𝘵.