Perspectives

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Thucydides Trap & Trade Wars

May, 2019

The outcome of the continuing trade war between the USA and China is difficult to forecast. At Tacit, we don’t believe in reading tea leaves, which our peers in the industry fancifully refer to as economic forecasting. We do however believe in looking at history as a rough guide to the future. The tension between […]

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What’s in a price?

May, 2019

For most people, their home is their largest asset. Yet, how many people get daily or monthly appraisals for their homes? And if this information was readily available, would it do anyone any good? Imagine if your home traded like an equity and you could sell fractional pieces of it to the public in exchange […]

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Objectives based investing

May, 2019

The four Tacit investment strategies have been specifically designed to meet investors’ objectives over a time horizon based on long term market return assumptions and historical evidence. The three key elements that are vital to remember are ‘an investor’s objective’, ‘historical evidence’ and ‘over a time horizon’. Historic evidence shows that the more equity exposure […]

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The Lindy Effect

May, 2019

For a company to have sustainable cashflows, it needs to have a contract with its customers. This contract can be literal or metaphorical. If you rent out a property and have a long-term contract with the tenant, there is some certainty that you will receive your rental income in full and on time. However, contracts […]

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A Framework for Decision Making

April, 2019

On the surface, science and investigative journalism appear to have nothing in common with investing since the two professions have nothing interesting to say about economics or a company’s business model. However, science and investigative journalism have a framework that helps in decision making which is very important in investing. The scientific method is all […]

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Checklists

April, 2019

Simple checklists have been shown to be a good antidote against ineptitude. Research has shown that checklists reduce error rates in intensive care units.  A simple checklist used by John Hopkins hospital reminding doctors to wash their hands and use antiseptic before operating on patients prevented infections, saved several lives and millions of dollars in […]

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The Importance of Small Numbers

April, 2019

At Tacit, we focus on limiting drawdowns. With the risk of sounding trite, maths shows us that a focus on minimising losses can increase returns. How? Let’s imagine you make a loss of 10% on an investment. In order to break even, you need to make back 11%.  If you lose 40%, you need to […]

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The Importance of Stabilisers

March, 2019

Although we have recently become more optimistic about certain equity markets over the last few weeks, the importance of stabilisers in a portfolio cannot be over emphasised. The Figure below shows the returns of a broad UK equity index versus index-linked bonds. The job of a stabiliser is to act as a hedge against uncertainty. […]

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Investment Strategy Quarterly Conference

March, 2019

We held our quarterly investment conference this week where we take the time to review the evolving economic data around the world and to consider the implications for our investment strategies. The OECD and the IMF have recently downgraded their estimates for global growth in 2019/20 by 20bps to 3.4%. Recent Sino-US trade conflict has […]

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Searching for an Edge

March, 2019

In 1969, Buffett announced he was closing down his fund – the Buffett Partnership. This was after a stellar track record of 30% annualised over a 13-year period since the fund was started. Some of his clients asked him to suggest other managers they could give their money to. One name that was thrown at […]