Absolute Valuations

I have heard money managers I respect talk about investing as a ‘comparative process’, meaning that you should look at the whole universe of opportunities and select the most attractive ones. While there is obviously merit to this, it is ultimately not how I go about things. For one I like the time and resources of an industrial money management operation to ‘consider the whole universe’, but I also think there is a powerful aspect of risk management in limiting yourself to investments which you see as attractively priced on an absolute basis.

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