Ann: Funds Under Management - April 2023, page-11

Great to see the smart money has joined the thread.

Losing money sucks, we all do it a lot and don't need people kicking us in the guts for it - the silver lining is any lessons we may pick up.

If investing wasn't nearly impossible it wouldn't be much fun, the difficulty comes in that we're guessing at radically uncertain future events.

I think Kerr was a sharp investor and see the fingerprints of his "edge" on the people he's trained, there's a reasonable probability these people can outperform.

I also see concerning signs, they were long CVNA when they should have been short. A google search would have told them Ernie Garcia II was a convicted felon, who pulled the exact sane scam before and there was no viable path to a profitable business.

That's a failure of process to me not just bad luck so I'd want to know is it endemic? How long will they say China is undervalued & are they right?

in '08 they had the cantankerous short-seller John Hempton who spotted subprime who is their debauched individual accepting such a thankless task today?

They are starting a renewable fund in what I think is a bubble - so are they going to be able to sidestep or profit from this present bust through shorts and pick up bargains on the way out?

They've commented adeptly on the oil and gas cycle, another of Kerr's hallmarks is cyclicality - did they position accordingly? It's one thing to be told and another to know it, see it and drop the hammer.

For me the jury's still out on that but the shareprice is pretty undemanding here so the balance of probabilities are for a reasonable outcome from here with some risks if they fail to deliver.

I think the way management are addressing Kerr's complaints are arrogant, dismissive and stupid. So that's a second question around shareholder alignment.

If their prepared to snub such a large holders' concerns are they going into bat for small shareholders and their clients or make excuses for underperformance and pay themselves bonuses?

This is one of the hardest businesses I have ever come across to analyze. I am OK with saying I don't know on pretty much everything and waiting for a fat pitch in one of the few areas my tiny brain can comprehend.