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Li Lu 2019 Speech


GFRhodes
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Many thanks for this.  Very interesting.

 

I had a look at your site, and glad to see you're a Lindsell Train fan.  I think their writings are excellent, and they have built the same 'trust' with their clients as a firm like Overlook.  I wish there were more firms like this!

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Thanks for the feedback everyone :)

 

Many thanks for this.  Very interesting.

 

I had a look at your site, and glad to see you're a Lindsell Train fan.  I think their writings are excellent, and they have built the same 'trust' with their clients as a firm like Overlook.  I wish there were more firms like this!

 

I think there aren't more firms like them because it requires foregoing short-term gain.  All the financial incentives pull the other way.  Plus, building a business for the long-term can increase risk in the short-term.  You can walk the high road but can you afford to keep the lights on?

 

IMO Li Lu's speech was all about margin of safety:  know what kind of participant you are in the market so you don't get shaken out by Mr. Market's siren song; behave in a way that benefits society too so you don't get shaken out if they turn against you; don't invest in what you don't understand so you don't get shaken out by life's many surprises; understand yourself and your emotions so you don't get shaken out by your own poor temperament etc. etc.

 

So yeah, I think building trust with your clients is an absolutely vital margin of safety too.  You don't want to be shaken out if your clients lose faith in you when it counts the most. 

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