Your Picky Purchasing Agent in a World of Games
Every day, you’re bombarded with investment advice. Financial news channels flash stock tickers and breaking market updates. Social media influencers tout the latest “can’t miss” opportunities. Your inbox fills with newsletters promising to reveal the next big winner. Everyone seems to have an opinion about where you should put your money.
Here’s the problem: most of these people aren’t paid to make you money. They’re paid to sell newspapers, generate clicks, entertain audiences, or move financial products. The only group that publishes the actual results of their advice? Professional money managers who are paid to manage other people’s money.
We’ve been professional money managers and stock pickers for decades, and we’ve learned something important: the people with consistently good long-term records look a lot alike. They focus on businesses, not on market noise. They understand that stock prices reflect the values of the underlying companies over time. And they know the difference between playing games and building wealth.
That’s where we come in. We’re your purchasing agent in a world full of salespeople. While Wall Street creates and markets new financial products faster than you can earn the money to buy them, we’re here on your side of the table, evaluating everything based on our mission of protecting and growing your assets. We are very selective. We are picky purchasing agents.
But here’s what makes us different from other purchasing agents: we understand the difference between “The Game of the Stock Market” and “The Business of Investing.”
The Game Everyone Else is Playing
Most of Wall Street is focused on the game. The game is entertaining, dramatic, and focuses on the most volatile aspects of price movements. Even the language is borrowed from gambling – “winners” and “losers,” “hot picks,” “beating the market.” The financial media feeds this game mentality because drama sells newspapers and keeps people glued to their screens.
The game can be profitable, but it requires an iron stomach and an against-the-crowd discipline that few people have. More importantly, for most people, the game is a distraction that prevents them from making money in the real business of investing.
When you’re playing the game, you’re constantly reacting to short-term hopes and fears. You’re buying when everyone else is excited and selling when everyone else is panicking. You’re chasing whatever investment theme is hot this quarter and abandoning strategies that have worked for decades.
The Business We’re Actually In
As your purchasing agent, we focus on the business of investing. This means looking at companies as businesses, not as ticker symbols that bounce around on a screen. We study the philosophies of people with good long-term records and a common approach: they own corporate stocks, but they evaluate them as businesses.
Over time, stock prices reflect the values of the underlying businesses. These values have increased by 9-10% per year historically, which means if you buy good companies and hold them long enough, your returns could be in that range. By contrast, long-term returns on bonds have been 4-5%, and CDs have been 2-3%.
Our normal position is to be invested in corporate stocks. Not because we’re gambling on short-term price movements, but because we’re partnering with profitable businesses that compound wealth over time.
What This Means for You
As your picky purchasing agent, we’re not impressed by the latest investment fad or the most dramatic market story. When Wall Street launches a new artificial intelligence fund or cryptocurrency product, we’re not asking “How can we get in on this?” We’re asking, “What businesses are we actually buying, and are they profitable at these prices?”
We’ve seen enough market cycles to know that complexity often masks poor performance. The best investments are usually the ones that make sense when you explain them to your neighbor over the fence. One of our maxims is “If you don’t understand it, it’s a bad deal.” If we can’t figure out why something is a good investment, we are happy to walk away and look for something else.
This approach has served our clients well. While others chased dot-com stocks in the late 1990s, we focused on profitable companies selling at reasonable prices. When everyone was buying houses they couldn’t afford in 2006, we were warning about unsustainable debt levels. We stayed focused on the business of investing while others got caught up in the game.
The Discipline of Being Picky
Being picky doesn’t mean being negative. It means being selective about businesses, not stock symbols. When we find companies that are growing their earnings, improving their competitive position, and selling at reasonable valuations, we’re happy to buy them. But we won’t buy something just because it’s new, popular, or moving up in price.
The mutual fund industry has trained investors to believe that more activity equals better outcomes. They want you to trade frequently, chase performance, and constantly adjust your portfolio based on market conditions. But periodic setbacks and a focus on the game result in people selling stocks when they should be buying, and vice versa.
Our job is to cut through this noise. We focus on finding good businesses and putting meaningful amounts of money to work in them. We’d rather own 20 great companies than 200 mediocre ones. We’d rather have five positions we understand completely than 50 that we’re guessing about.
Why We Created Our Mutual Fund
Consequently, we are not in the mutual fund business. We are in the profession of investing our clients’ money; we are professional money managers. We’ve created a mutual fund so we can make our purchasing agent services available to everybody, regardless of investment experience, net worth, or whatever.
We want to help you focus on the business of investing instead of getting distracted by the game. That means saying “no” to most of what Wall Street is selling and saying “yes” to the opportunities that truly make sense for building long-term wealth.
Your purchasing agent’s job is to protect your interests and help you build wealth over time. And that’s exactly what we do – one good business at a time.
The opinions expressed are those of Tony Muhlenkamp and are not intended to forecast future events, guarantee future results, or offer investment advice.
Investing involves risk. Principal loss is possible.
