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"History doesn't necessarily repeat itself, but it does tend to rhyme. "
Investors today seem to be enamored with growth in the US tech sector, regardless of valuations. By contrast, Soo Chuen and his team practice the increasingly rare art of contrarian value investing on a global scale.
Soo Chuen Tan is President of Discerene Group LP, a Connecticut-based private investment partnership that invests in businesses protected by either structural barriers to entry (“moats”) or hard assets, when such businesses are out of favor, at prices offering significant margins of safety.
In this episode, Soo Chuen discusses the psychological and philosophical under pinnings of value investing, including (1) being greedy when others are fearful and fearful when others are greedy, (2) viewing risk as the probability and potential magnitude of permanent capital impairment rather than volatility, (3) distinguishing price from value, and (4) requiring a margin of safety.
Soo Chuen also discusses the importance of understanding the historical, social, and cultural context of a business enterprise. What are the unspoken norms that a management team operates by? What are the values of the country or culture that the business operates in? Values, after all, guide behavior, and behavior influences outcomes.
Soo Chuen speaks of several investments he's been involved in around the world, and what he's learned from each. In particular, he shares his reflections on operating in "thick" versus "thin" cultures.
Born in Malaysia to two physics teachers, Soo Chuen discovered his calling as a value investor in his mid-twenties while in business school. Soo Chuen holds a Bachelor/Master of Arts degree in Jurisprudence from Oxford University, where he was awarded the Martin Wronker University Prize for Law. Soo Chuen also holds a Master of Business Administration degree from Harvard Business School, where he was a George F. Baker Scholar. Before founding Discerene, Soo Chuen worked at Deccan Value Advisors, the Baupost Group, Halcyon Asset Management, and McKinsey & Company.
Accomplished investors share their stories, mental models, and what market factors they’re paying attention to today. Host Andrea Gentilini of Novus unpacks what has helped them and hindered them on their diverse roads to success.