Why fix it when it is not broken?

Peter Cundill recently passed away. His well-deserved renown as a money manager was partly for his pioneering search for companies from around the world, at a time when North American companies dominated investment portfolios. His investment philosophy is captured by the title of his well-read book:  There’s always something to do. We recently asked a student of Mr Cundill how this relates to current thinking calling for a plan and then staying with it.

It was agreed that one should absolutely avoid knee-jerk reactions. Still, there is little doubt that the investment industry thrives on action. Equity trading inspired by new information, and revised interpretation of existing information, abounds. Our concern is that new isolated data points are often out of context,  and thus insufficient reason to deviate from an investment plan.

We steadfastly stick to a carefully crafted set of criteria and a planned implementation process. At every turn we resist changes for the sake of changes. We establish key items at the outset, and do not stray when a new opinion is tabled, a trendy theme emerges, or flimsy evidence is uncovered.

You will find that this approach works, especially in the long run. From time to time paradigm shifts will be talked about in publications and conversation. Take them with a grain of salt.