Aravt Global

“So what we've landed on in Compounders actually is a version of exclusively focusing on monopolies and oligopolies, finding growth rates of earnings power that is in the twenties to thirties, multiples of the underlying market, And then finding them with reaso…”

“We do not think every day if we bought our portfolio what we do. I think that's a false paradigm. And by the way, Antithetical to tax effective investing. I just, I believe it's false precision.”

“And so I believe, and that's what we've done too, is a scaling management fee, a fixed hurdle, right? Hard hurdle, no catch up, and then a fixed component of the carry above it.”

“Us as an institution, we would spend less than a third of our time short selling less than a third. And we can sustain five to 800 basis points a short alpha by doing that because we've built up seven years of inventory.”

“So the three are built up of one is compounders at large. There's lots of different variants in there dependent upon the growth rates and evaluation paradigms. The second is called secular within cyclical. It's a commodity framework where there's a demand shoc…”

“In fact, we don't even trade day off. I don't even have a Bloomberg, right? We trade on a T plus one basis to remove the adrenal elements of decision making.”

“If you own a position, a very concentrated portfolio, which ours is 80 to 90% for the top 10”

“You have an entire demand shock shift in the demand curve. Into a fixed or delayed supply response. So what happens is you have a lower quality industry and margins explode and stay high for multiple years. And that drives a rerating from usually a mid single …”

“We only had three shorts left by the end of March, right? We covered everything. And that dramatically increased our net exposure”

“We're pretty concentrated in our top 10, but we do it facing downwards, not upwards, where how much money can you lose in the big positions, not how much money that can you make. That's the only way you navigate for duration.”

“Like on the long side, we're playing for multiples of our capital. On the short side, we're playing for between 15 and 30%.”

“Authenticity, I made a huge mistake when I started R of Art Global in that I was failing conventionally. I went into a classic tiger construct, and it's terrifying being fully authentic.”

“Our mission on the short side is to deliver five to 800 basis points of alpha consistently.”

“And what I found is about 14% of securities above a billion dollars in market cap could do it. This was in the prior 26 years. And only three percent of securities could do it for 10 year rolling periods.”

“So in 2017, spanning 2017, we had enormous performance, but we bought one stock for 17 months.”