Robert Wilson
Market Wizards Index: +34%
Compound annual over 20 years
Fund or affiliation
- Independent short-seller.
Methodology
- Short-selling and busting mediocre concept stocks that get wildly puffed up by hungry stockbrokers.
Research Techniques Employed
- Spends two-third of a day on the phone, and one-third of it reading business magazines and telephone messages taken by his secretary. Goes out a lot at night with stock market friends.
- He virtually never visits companies or assesses their management firsthand. Did go to WEMA (Western Electronics Manufacturer’s Association) conference every year.
- Buy companies that are doing something new and different, or doing it in a different way. Buy technology companies that could go up ten times in five to seven years.
- Don’t try to anticipate how fast competition will undercut an established company.
Trading/ Valuation Techniques Employed
- He likes to short into strength in a stock, not when it’s already on the way down.
- Points out that only in US market can one take short positions that can be kept in place month after month.
Philosophy and beliefs
- Insists on stocks in which there is a major risk, because such a stock is likely to go way up. "Unless there is fear in a stock, it probably doesn’t have a great capital gains potential."
- Bets on the stock image that he thinks will excite the public in a few months or a year. You get a better move "playing the surprises".
History and other facts
- Worked for First Boston, General American Investors, a closed-end fund, and A.G. Becker & Co. Set up his own hedge fund in 1968, gets 20% of any outperformance over S&P 400.
- An important patron of New York Metropolitan Opera and Whitney Museum.
- Quotes Bernard Berenson: "In order to be comfortable, one should have a little more money and a little less time than one needs."
- "Living well is the best revenge."
- Following J.P. Morgan’s dictum "I can do a year’s work in nine months, but not in twelve."
Examples
- Lost $10M shorting Resorts International, which is likely to be remembered as the most catastrophic short play in modern times.
Performance Record
- 34% over 20 years: "In 1958 he received an initial stake of $15,000 from his father and has multiplied his assets into the tens of millions... in spite of fearful setback in 1978".
All International Welcome Messages: 1, 2, 3, 4, 5, 6, 7 & 8
