| Topic Name: |
How is Fisher Investments? |
| Message Name: |
Still more from Ken Fisher |
| Date Posted: |
04/24/2002 |
| Message: |
As to the comments about us being a quantitative versus qualitative firm, we do both but we also think about both differently than most firms. It is fair to say we think about markets differently than most folks, which by itself may end up bad or good. You may dislike how we think about markets, which is fair, but you also may not understand it.
I have been in the industry 30 years, longer than many of you may have been alive. I??ve written orbes ??Portfolio Strategy?? column for 18 years and am now the sixth longest running columnist in Forbes?? 83 year history. I??ve been published many times outside of Forbes including numerous scholarly publications. My belief in finance theory is basic. My belief in academics and universities is non-existent. In finance theory and reality the market is a discounter of all known information. Among other things, that should apply to curriculum, which by definition is known information and the market must discount its value effectively to zero. This is a major divergence between our views and those of most folks in this industry who to me seem more like members of a union or guild seeking walking papers with which they associate pride. Also, academics hate this notion. But, in behavioral finance theory the big killer is the accumulation of what behavioralism refers to as ??pride?? which is largely the tendency to associate success with skill or repeatability. It gets its route in evolutionary psychology. Hanging degrees after your name is one function which demonstrates pride. But when you accumulate pride in something already discounted to zero value, you??ve started out by placing yourself in a negative position--sort of digging yourself into a hole--which is why the firm discriminates against that.
The goal is to know the stuff without accumulating the pride. Hence we discriminate formally against CFAs and MBAs and other degrees. We hire and train. We also discriminate against big name schools for similar reasons and the bigger the name the more we discriminate. The problem with big name schools is that too many of the graduates are simply too snooty to work hard enough and presume they know little enough to get ahead. If you think you know something about finance because of your degrees this firm is a hard place to get a job and a tougher place to keep one. It isn??t that we won??t hire them but we require them to have something extra to make up for it. This form of discrimination is neither illegal nor unethical. This infuriates these folks. Tough. Imagine how the Stanford grad feels when we ask him/her what he/she has to make up for it??????
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