My Worst Investment Ever Podcast
Business:Investing
BIO: Mike Philbrick is the CEO of ReSolve Asset Management. He has over 30 years of experience in investment management, serving in senior investment industry positions with several major financial services firms, and is responsible for investment decisions, coaching, and strategic leadership.
STORY: Mike learned of a mining stock at the urinal. He invested, and the stock performed well because the mining industry was on fire. And so encouraged by early success and massive ignorance, Mike wiped all of those gains in no time.
LEARNING: Don’t over-leverage. Understand what kind of investor you are. Ensure you have some protection before you go all-in in an investment.
“Just because you’re winning doesn’t mean you’re smart or you’re good at these things.”Mike Philbrick
Guest profile
Mike Philbrick is the Chief Executive Officer of ReSolve Asset Management. He has over 30 years of experience in investment management, serving in senior investment industry positions with several major financial services firms, and is responsible for investment decisions, coaching, and strategic leadership. He has co-authored the book Adaptive Asset Allocation: Dynamic Global Portfolios to Profit in Good Times – and Bad (Wiley), as well as several whitepapers and research focused on adding new insights to the quantitative global asset allocation space.
Adaptive Asset Allocation and Return Stacked Portfolio Solutions have been popularized by him and his team at ReSolve.
Preceding his investment career, Mike played professional football in the CFL, winning the Grey Cup Championship in 1999 and being inducted into the Hamilton Tiger-Cat Walk of Fame in 2015.
Worst investment everBack in the early 90s, there was a lot of mining going on in Canada, and so mining stocks were becoming popular. Mike had started noticing the stocks but had yet to invest. One day, he’s at a urinal, and a guy tells him about a particular mining stock. Mike figured it was a good idea to invest in the stock. He didn’t do any research; he just took the man’s word for it.
The stock wins, and Mike gets a couple more wins from the stock, not because he was a genius but because the mining industry was on fire. And so emboldened with early success and massive ignorance, Mike wiped all of those gains in no time.
Lessons learnedAlways remember that you don’t know as much as you think, so take different approaches such as diversifying, being less confident, managing risk with stop losses, or managing risk at the portfolio level on an ongoing basis. You don’t need to own more of what’s going well. Just do less of what’s dragging your portfolio from a momentum factor that enhances returns.
Mike’s recommendationsMike recommends his book Adaptive Asset Allocation: Dynamic Global Portfolios to Profit in Good Times – and Bad, which goes through steps that you would take to maximize diversification and how to use the factor of momentum to enhance that.
No.1 goal for the next 12 monthsMike’s number one goal for the next 12 months is to get his firm 1.5 billion dollars in assets under management.
Parting words“Stay true to yourself.”Mike Philbrick
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Connect with Mike Philbrick
Further reading mentioned
ISMS 41: Larry Swedroe – Focus on Managing Risk Not Returns
Chris Ball - If They’re Not 100% Right, Don’t Hire Them
Vivek Raina - Nobody Can Beat You at What You’re Good At
William Cohan - Power Failure: The Rise and Fall of An American Icon
Tony Fish - Be Brave to Ask the Unsaid Questions
ISMS 40: Larry Swedroe – Market vs. Hedge Fund Managers’ Efficiency
Chris Kendall - Don’t Underestimate the Funding Needed to Go Big Time
Riggs Eckelberry - Don’t Go into Any Industry Unprepared
ISMS 39: Larry Swedroe – Don’t Choose a Fund by Its Descriptive Name
Lark Davis - Take Your Profits and Run Away
Sam Primm - Be Intentional About What You Invest In
Marc Faber - The Value of True Diversification
Coach JV - Diversify Inside and Outside the Asset Class
ISMS 38: Larry Swedroe – The Self-healing Mechanism of Risk Assets
Solomon Thimothy - Give Yourself Permission to Fail
Anthony Greer - Be Patient and Willing to Get Rich Slow
Kevin Sutantyo - You Have to Back the Right Founders
Dan McClure - Understand Who You Are and What You’re About
Bryan Kramer - Be Human and Build Relationships
Andrew Stotz - 8 Benefits of Increasing the Profits of Your Business
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