In episode 138, we welcome Yariv Haim. Yariv begins with his backstory. He had been working for a family running marketing and business development. He was asked to get involved with the investment management needs of the family, and through a path of his own, had gained enough knowledge to crystallize an approach he now follows at Sparrows Capital.
Yariv discusses how he focused on evidence from impartial academic institutions and research, and refers to the strategies derived from them as evidence-based investing strategies. After doing his research, he saw an informational gap in the industry, and it still exists today.
Yariv then gets into 6 core principles 1) return is primarily a function of risk, 2) certain risks attract persistent premium, 3) Diversification works, 4) stock picking and market timing seldom add value, 5) remain invested across the full cycle, 6) costs matter (although it isn’t the only prism to evaluate investment opportunities).
Next, Meb asks about factors and smart beta. Yariv discusses his opinion that Wall Street is a marketing machine, and the term “smart beta,” while it sounds sexy, ends up becoming an umbrella for all things. When asked about factors and when it’s time to stop using them, Yariv responds by discussing resources available, and the importance of doing the homework, and not to invest until you fully understand what you are investing in. As far as favorite factors go, Yariv talked about not having one, and expanded by saying he sees factor timing as a problem. He recommends a blend of factors to clients, starting with the most diversified portfolio, and building tilts.
The conversation then shifts to a discussion of behavioral investing. Yariv talks about how investors are all human beings, human beings are filled with biases and emotions, and feelings of optimism and pessimism can affect the way we make decisions. He finishes his comment by saying he feels that for people who wish to invest on their own, that it is always helpful to have someone by your side who is potentially slightly less emotional about the way your portfolio behaves in the short term.
As the conversation winds down, Meb and Yariv get into socially responsible investing and environmental and social governance themes. Yariv believes it is a trend that nobody can ignore today. He discusses some research conclusions the efficiency of markets and how higher returns investors have earned on vice companies is compensated for the additional risk they bear for owning them. He makes the point that there is more to investing than purely outcome in the form of returns, and that if an investor’s ethical compass steers them in the SRI/ESG direction, it is sensible to invest that way.
The pair then conclude with how Yariv puts all of these ideas together to form investment portfolios.
This and more in episode 138.
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Hendrik Bessembinder - Do Stocks Outperform T-Bills? | #532
GMO's Catherine LeGraw - Capitalizing on Global Asset Allocation in 2024 | #531
Professor Kenneth French on Risk, Return, and Rationality | #530
MEBISODE: T-Bills and Chill…Most of the Time | #529
Cliff Asness: Timely & Timeless Investment Wisdom | #528
Indexing Nevada PERS: Steve Edmundson’s $60 Billion Strategy | #527
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Grant Williams & Peter Atwater: The Market is 'Long Abstraction, Short Reality' | #525
Tim Ranzetta, NGPF - Teaching America Personal Finance | #524
Whitney Baker on The Death of (Upside) American Exceptionalism | #523
How to Convert an SMA to an ETF with Wes Gray & Robert Elwood | #522
MEBISODE: A Better Approach to Dividend Investing
GMO's Tina Vandersteel on a "Once-in-a-Generation" Opportunity | #521
Drew Dickson on Navigating Behavioral Biases, U.S. vs. European Stocks, & Tesla | #520
Ben Mackovak on The Secret Sauce of Investing in Banks | #519
Jared Dillian on the Keys to Live a Stress-Free Financial Life | #518
Bruno Caratori - The Bitcoin ETF is FINALLY Approved. Now What? | #517
BlackRock's Rick Rieder on The State of Markets & The US Debt Problem | #516
Felix Zulauf – 2024 Macro Outlook Not Rosy | #515
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