#41 – The Composer

Chapters

00:02 – Consistent communication for success

26:28 – Focused sector selection strategies

42:28 – Avoiding common investment mistakes

01:00:48 – Balancing contrarian and active approaches

01:13:03 – UK equity market dynamics

One Highlight

“I didn’t look at my weekly performance. I didn’t. I think it only sort of depresses you. I didn’t, you know, when you’re not doing well.”

Transcript

STEPHEN CLAPHAM: Hi, welcome to the Behind the Balance Sheet podcast where we meet leading investors and commentators and educate ourselves about the world of investing and the world. Our mission is to remove some of the mystique around investing and improve our understanding of what makes a successful investment or indeed an unsuccessful one. Our goal is to inform, educate and entertain. We hope you enjoy this and every episode.

DISCLAIMER: And podcast guests may own shares or have an economic interest in securities discussed in this podcast, which is aired for your education and entertainment only. Nothing in this podcast should be construed as investment advice or relied upon for investment decisions. Always do your own research.

STEPHEN CLAPHAM: This episode is brought to you by Alphasense, the number one rated financial research solution by G2. I’ve started using the platform. And now I can access all the company documents, the earnings call transcripts, and the expert network call transcripts in one place.

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STEPHEN CLAPHAM: But many investors don’t apply the same level of discipline to position sizing as they do in their research process. They may know that their best idea is their biggest, but they can struggle to answer, what’s my sixth best idea or my sixteenth? Have you ever wondered how the best fundamental managers size their positions?

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STEPHEN CLAPHAM: My guest this month is a very unusual one. Anthony Bolton is 74 years old and gave up his Bloomberg many years ago and now composes classical music. But he’s a very special investor whom no less than Peter Lynch described as one of the best investors on earth.

STEPHEN CLAPHAM: And that’s justified when you look at his track record with the Fidelity Special Situations Fund. 19.5% per annum for 28 years, or 6 percentage points above his benchmark.

STEPHEN CLAPHAM: Lynch was a colleague. And who better to write the foreword to your book? And Investing Against the Tide, Anthony’s book, is in my view an investing classic. Another colleague described Bolton as the bravest… Fun manager that he ever met.

STEPHEN CLAPHAM: We recorded this episode live at the Library Of Mistakes in Edinburgh on November 21st, 2024. That delayed our usual publication date and the sound may not be as perfect as in our London studio, but I can promise you the quality of the content will be as good as ever.

STEPHEN CLAPHAM: Meeting Anthony Bolton was a great privilege and interviewing him was even better. Thank you for listening. And enjoy this episode with one of the greats. Anthony Bolden needs no introduction. And Anthony, what makes a difference between a good fund manager and an average fund manager?

ANTHONY BOLTON: Well, in my view, the thing that makes the difference is avoiding the mistakes. I think all managers get successes. But if you can avoid the disasters, avoid the mistakes, I think that is what… One thing that really differentiates the two. So being in the Library Of Mistakes, I think.

ANTHONY BOLTON: Learn from your mistakes and try, obviously, avoid making them. But that will get you, if you avoid the mistakes, I think you can get up into the top quarter.

STEPHEN CLAPHAM: I mean, you’ve seen over a long period, you’ve seen a lot of really good investors. What are the characteristics of the best investors, apart from the fewer mistakes?

ANTHONY BOLTON: It’s a lot about the… The type of the individual, the mind, and the flexibility and being unemotional. I mean, I think it’s terribly important to be unemotional, to be flexible. I think arrogant people and people who so much believe that they’re always right will make bad investors because Things are constantly changing in this business.

ANTHONY BOLTON: And I think it’s about conviction. It’s having conviction. But conviction varies over time as information comes in, as different events happen. No one can exactly predict the future. So there are always things coming left field to knock you. But I always say that investing is as much about understanding yourself. As it is about understanding the outside world.

STEPHEN CLAPHAM: And your book, and if you haven’t read Anthony’s book, you really should read it, because I reread it, actually, before doing this. It is fantastic. But it’s called Invest Against the Tide, and you say that you’re more comfortable swimming against the prevailing flow.

ANTHONY BOLTON: Is that a…

STEPHEN CLAPHAM: I mean, you seem like a very nice, easygoing guy. And you don’t seem to have that sort of characteristic because that’s a characteristic of something quite cynical.

ANTHONY BOLTON: I don’t know what it is. I mean, people have asked me, well, is that the same in other things you do in life? And I don’t think it necessarily is. But I’ve always been so interested in the stock market, as Buffett said, you know, the voting and the weighing. And it’s the voting side that particularly interested me and sentiment.

ANTHONY BOLTON: And fairly early on, there was the big fund in those days was the MNG Recovery Fund, and it was a contrarian fund. And when I was learning the business, I read up about it, and I just identified so much with what it was doing and sort of being contrarian. And I think…

ANTHONY BOLTON: My talking about, you know, my personality work or my makeup was good for being a contrarian. I was happy, you know, I think most people like fashion and they like to be part of the fashion. And I was happy to stand aside. And popularity to me is risk and investment. When things become too popular, that’s when they become.

ANTHONY BOLTON: Risky and vice versa. When they’re not popular and when they’re unpopular, there’s opportunity. It doesn’t mean everything that’s unpopular is going to be a good investment. But I like to look in the unpopular areas. And as soon as something got very popular, I became uncomfortable.

STEPHEN CLAPHAM: And so did that, what happened internally at Fidelity is when everybody else was.

ANTHONY BOLTON: Buying the stocks that you owned and you started to sell were they not all going oh hang on Anthony said we better get rush out the door as well no funny at least i don’t think it it happened like that because within Fidelity we had you know a range of different managers i mean we had a great growth manager colin stone who’s retired like me but you know we had a spectrum of of approaches.

ANTHONY BOLTON: But I mean, everyone was, you know, for all of us, it was fundamentally based and meeting the companies was terribly important. I remember a colleague, he was, I mean, he would go through every line, you know, of the analyst model, line by line, cross-examining them on every assumption behind every variable.

ANTHONY BOLTON: I’m not saying that’s wrong. That just wasn’t what I focused on. I would focus on different things from that. And I’d let my colleagues sort of spend more time on dissecting the analysts’models.

STEPHEN CLAPHAM: And you spent a lot of time meeting companies.

ANTHONY BOLTON: Did you have a set structure for a company meeting?

STEPHEN CLAPHAM: Did you run this through?

ANTHONY BOLTON: Oh, yeah. I mean, the way we operated, and it wasn’t the case in my very early days, but once we had a team of analysts and sector-based analysts, the analyst would set the agenda for the meetings. And that didn’t preclude some of the… Portfolio managers asking their own questions.

ANTHONY BOLTON: It was great because, you know, I was doing four or five a day. And if someone had already got the question sheet, and it was always our questions rather than letting the management say, you know, just read off a script or a presentation.

ANTHONY BOLTON: And consistency was really important to me. I kept copious notes and it was all handwritten in those days. And consistency was really important to me. You know, if something three months later was different from what it was three months ago, if they said it, then I started to worry. The good thing probably, and there’s some management here, so…

ANTHONY BOLTON: You know the management probably were doing lots of meetings so they probably couldn’t remember exactly what they said to Fidelity versus what they said to another investor but i had it written down so the moral for the management here is say the same thing aspirations even if it’s wrong yeah say the same thing yeah but were there particular and signs that you look for in a management meeting so what would make you what would make you go out and sell well what would something It’s, what would make, let’s start with what would make me buy.

ANTHONY BOLTON: It was, I mean, it was a margum of things, but you sort of knew it when you saw it. That was the thing. And, you know, there were some meetings you came out of and sort of the adrenaline was buzzing. This looked amazing and it’s unrecognized and other people don’t. Understand the potential or whatever it was.

ANTHONY BOLTON: In terms of, you know, why did I sell things? Because the thesis was broken. So nearly always was the thesis behind why we own something. And something changes, you know, could be something predictable, it could be something unpredictable. And that was what made me change.

ANTHONY BOLTON: Just trying to think of specifics. But for me, it was generally incremental. So I didn’t one day come in and buy a huge position and for the next day, you know, sell all my holding. Very occasionally I did that when something really drastic happened. It was incremental.

ANTHONY BOLTON: My conviction was building, so I’d start with a small position and then we’d meet again and then I’d perhaps double that. Position and then as the conviction went up or maybe the stop price came back and I felt the valuation opportunity was even greater. And it was the same on exiting, nearly always, you know, I’d say, well, actually, it now looks much more fairly valued.

ANTHONY BOLTON: I still think there’s some upside, but I’m going to, you know, keep half the position that I had or it’s got more risky, you know, they’re doing something which… Could be great news, but actually, if it doesn’t work out, the downside’s greater. So I want to have a smaller bet than I had.

STEPHEN CLAPHAM: And laterally, you had a very big fund and 150 plus positions. How did you manage, I mean, this is a huge number.

ANTHONY BOLTON: Yeah, I mean, coping with size was obviously a big challenge. And we weren’t analytical enough in those days to think about capacity.

ANTHONY BOLTON: You know managers are much more professional these days and saying you know what is the capacity for this particular approach or this particular portfolio manager and there was a sort of feeling you know you could go on forever with a fund that grew and grew and grew i remember actually it was i had a particular advantage i went to one of my trips to Boston and I saw Peter Lynch and Bruce Johnson, less known Fidelity manager, but he ran our income funds very successfully.

ANTHONY BOLTON: And I said, you know, how do you cope with size? And they said, well, You know, use the team to help you monitor. But the most important thing is, you know, it’s a balance always as an investment manager of looking after what you already own and being on top as things change, but scouting for new ideas.

ANTHONY BOLTON: And they said the big mistake, as soon as you start to have a big portfolio, a large portfolio, a lot of holdings, is you’re spending all your time on monitoring what you already own. And you feel.

ANTHONY BOLTON: If you own it and it comes into the office, then you’ve got to go to that meeting. They said, well, use the analysts to help you and the feedback. You can’t go to all these meetings, but make sure you’re always spending enough time scouting for new ideas.

STEPHEN CLAPHAM: That’s interesting.

STEPHEN CLAPHAM: Watching what you own is what everybody said. I mean, what was Peter Lynch like to work with? Did you work quite closely with him? I mean, obviously in different sides of the Atlantic.

ANTHONY BOLTON: Yeah, he taught. I mean, he… He taught me a lot about, you know, company meetings and taking notes, etc. He was, you know, if you’ve read his books, you can talk about how he went about investing. But he was an inspiring person, a demanding, I mean, very demanding with the analysts, I would say, but an inspiring person to work with. And it was interesting, complete and different to myself when I stopped.

ANTHONY BOLTON: You know, I stopped and left time in my life to do other things. I remember going to see Peter, and this is still a while back, but he had already, you know, stopped running funds at Fidelity. And he was in an office somewhere else in Boston. But I went into his office and it was exactly the same as one of the offices that I went in, you know, surrounded by screens, reports and everything. So he was still spending.

ANTHONY BOLTON: Most of his day doing the same job but this time just for himself rather than and because he didn’t that was his life he was so full yeah so he loved it and you know i don’t i you know i admire that that i that i got to a stage in my life where i wanted to sort of create some time for some other things it is a very all-consuming thing oh it is all-consuming and Normally, when I meet people who’ve been in the business and then say they retire or whatever, and they’re doing it part-time, they say, having done it full-time, it’s very difficult to do it part-time.

STEPHEN CLAPHAM: As soon as you stopped, you started writing the book. What made you write the book?

ANTHONY BOLTON: I wanted to pass on some of the things I’d learned. The thing is investment. None of us do anything new. You know, most of the things we look at, et cetera, have been around for a long time. But it’s more the amalgam of, you know, how we put it together, what weight we put on this factor versus that factor.

ANTHONY BOLTON: And I wanted to sort of write a book from a contrarian investor’s point of view with the things that were important for me. And, you know, there are some things there, you know, some…

ANTHONY BOLTON: Some managers would say, you know, looking at charts, technical analysis is a complete waste of time. I actually find it useful as a sort of confirming. It helped me identify changes and stuff. So I thought if I pass that on, hopefully it might help some other people.

STEPHEN CLAPHAM: I mean, it’s a very unpopular thing to say. I mean, I always think, you know, somebody gives you an idea. The first thing you do is look at the chart, right?

ANTHONY BOLTON: Yeah. Well, I, yeah, the first thing. Yeah, it’s the first thing I always looked at because my first question is, am I early or late? You know, and the chart immediately told me, you know, the answer to that.

STEPHEN CLAPHAM: But you, I mean, you didn’t spend all your time buying things that had fallen a long way. You would buy things with much minimum.

ANTHONY BOLTON: And actually, you know, some of the best investments was actually doubling up on something that had already started to rise. Where one’s conviction had increased. And I 100% believe in the view, just forgetting the price you pay is so important. You’ve just got to come afresh every day to it.

STEPHEN CLAPHAM: Well, you said in the book that you didn’t have a very good memory.

ANTHONY BOLTON: I didn’t have a very good memory anyway. So I had to remind myself. And actually, that’s where the notes were really useful, rereading the notes. And even today, when I have a… I still do some meetings to do with all charity and stuff. I don’t like to read. The notes too early because I’d probably forgotten by the time the meeting happens the detail of it.

STEPHEN CLAPHAM: Do you think that was an advantage, not having that sort of I paid this for it?

ANTHONY BOLTON: I think it was with me. On the other hand, one of the most successful Fidelity managers was someone called Joel Tillinghurst who had a contrarian style and he had a photographic memory and And he had, I don’t know, hundreds of stocks in his portfolio.

ANTHONY BOLTON: But if you asked him about any one of them, he could reel off the detail. He knew everything. I couldn’t do that. I mean, I can’t remember or keep in mind the detail of 300 companies.

STEPHEN CLAPHAM: You’ve got to be a bit on the scale to do that.

ANTHONY BOLTON: Yeah. So it worked. For me, but I’m not saying that, you know, that means that it will work for everyone.

STEPHEN CLAPHAM: And are you still in touch with people that you used to work with at Fidelity? Oh, yeah.

ANTHONY BOLTON: Like, the nurse? Yeah. No, I mean, more on this side of the Atlantic, because as the Fidelity got bigger, Fidelity, the non-US side of Fidelity was always separate from the US side. Or in fact, I think it was… After I joined Fidelity about six months later, we split into two.

ANTHONY BOLTON: But for a long time, we had a close relationship with the managers there. But then a bit like I think Capital has done, we took the decision that to give us more capacity for buying bigger stakes in company, we needed to put a Chinese wall between the American side and the international side.

ANTHONY BOLTON: And so we only started, we only saw their research with a sort of 90 day lag. Oh really? Yeah.

STEPHEN CLAPHAM: And you said earlier, you talked about arrogance and you wrote in the book that we’re all over confident. You mustn’t let a good run go to your head. How did you manage to keep your feet on the ground after 25 years of success? How did you not get caught by that?

ANTHONY BOLTON: Because you were always being reminded how fallible. You were. I mean, this game, you just keep making mistakes. I mean, back to mistakes. But, you know, if you get it right 55% of the time, you’re doing okay.

ANTHONY BOLTON: I think it comes back to the nature of the person, you know.

ANTHONY BOLTON: I believe strongly, you know, to be a successful investor, you shouldn’t let success get to your head. But conversely, you shouldn’t let failure get to your head. Everyone has a bad period. I’ve seen it in colleagues that when they’re going through a bad period, they lose their confidence, et cetera, and they go into a sort of spiral.

STEPHEN CLAPHAM: Because you’re not taking risk.

ANTHONY BOLTON: Yeah. And that’s really bad as well. What did you say to somebody when they were having a… I think you’ve got to say, look, learn from your mistakes. But… Remember that we all make them. And if you believe in how you invest, then stick with that and you will have bad years.

ANTHONY BOLTON: But at least the way we ran money, you know, which was generally taking one to two year view time scales. So we were never really short term in, you know, looking. Just at the next earnings.

STEPHEN CLAPHAM: You had periods where you underperformed. Oh, yeah. And what did your colleagues say to you?

ANTHONY BOLTON: I think the only time I ever talked to Ned Johnson about my performance was, I think my worst period was the recession of the early 90s. Was it 89, 90, 91? I had three poor years. Which for most people probably is the end of their career. I think the only time Ned Johnson talked to me about, specifically about my performance in investments was after those three years.

STEPHEN CLAPHAM: What did he say?

ANTHONY BOLTON: He said, you know, is it going to turn around? And I said, well, I’m going to do my best. And it did turn around, yeah.

STEPHEN CLAPHAM: But of course, there’s nothing you can do.

ANTHONY BOLTON: There’s nothing. It’s a strange business. You know, I think a lot of new people come into it and they think it’s about effort. You know, it’s like sports or, you know, even for a musician, effort comes into it. Well, there’s an element of effort, but you can’t say to yourself, you know, try harder to morrow Bolton. You’re going to do better. You just have to keep on re-examining what you’re doing and be honest with yourself.

ANTHONY BOLTON: I think that’s where this sort of insecurity, conviction, having conviction but always willing to be open to the fact that you’re wrong is important because things change.

STEPHEN CLAPHAM: And when you were underperforming, did you reduce the turnover in the portfolio or increase the turnover in the portfolio?

ANTHONY BOLTON: It’s a good question. I don’t remember specifically doing either of those.

ANTHONY BOLTON: What I did find, it was probably in the good times, you tended to build up the number of holdings. In the less good times, it was a good time for pruning, you know, going back to the things you felt the strongest about and maybe pruning out some things that were less keen on.

ANTHONY BOLTON: I did the same in bull and bear markets. In bull markets, you tend to, you know, to have more stocks and more things you’re interested in. In a bear market, that was a time I found for weeding out the less good things.

STEPHEN CLAPHAM: And then. So you’d have a more concentrated portfolio in a bear market. And that was because you were becoming more defensive?

ANTHONY BOLTON: No, it was trying to focus on where you had the biggest conviction.

STEPHEN CLAPHAM: But why should that be different?

ANTHONY BOLTON: I don’t know. I just found in the bull market there tended to be more good stories, you know, more interesting things. And therefore, my number of holdings tended to…

STEPHEN CLAPHAM: This is formal. Pardon? This was formal, fear of missing out.

ANTHONY BOLTON: Yeah, maybe it’s the fear of missing out. No, I think the nature of bull markets is that there are more good stories around, more interesting things to invest in. Yeah.

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STEPHEN CLAPHAM: You said in the book you value two attributes, most highly common sense and temperament.

STEPHEN CLAPHAM: We’re all stuck with our genetics. What can you do to improve those?

ANTHONY BOLTON: Well, I think the first thing is to know yourself, know what your strengths and weaknesses are. And I think if you know that you’re emotional, you’ve got to try and control that. To be honest. I think that some people are just not made out for the job.

ANTHONY BOLTON: So if you’ve got, if your personality, if you are very emotional, you know, you can only buy something after everyone else has bought it and you’re near the top and you’re going to be shaken out because you’re scared and you don’t have enough conviction in what you’re doing. Then I don’t think it’s a job for you, at least not as a sort of bottom up stock picker.

STEPHEN CLAPHAM: And would you get involved in recruitment or in deciding which of the analysts were going to be PMs? Yes. And how did you judge that?

ANTHONY BOLTON: Well, you could see it. I mean, in the recruitment, one of the things we used to do was what we call a prospectus test. And we would give someone who came in a company to look at, and we’d put them in a room for a couple of hours or so with a whole lot of information on that company.

ANTHONY BOLTON: And then we’d come and say, come and present to us and tell us if you think it’s a buy or a sell. And it’s a very good exercise because we weren’t looking at, you know, was the conclusion right or wrong, but you really understood how they thought. Could they? Read stuff and summarize it? Could they find the most important things?

ANTHONY BOLTON: Because investment is so much often about finding three or four really important things and knowing what not to look at or not to be interested in is important. And then, of course, could they convey it? Because an analyst who’s brilliant but can’t convey, you know, is that… What they like and what they don’t like is also no good.

ANTHONY BOLTON: In terms of promotion to a fund manager, I really think the thing in this business, someone can get by with luck for two or three years. I think beyond three years, it’s very difficult to get by purely from luck.

ANTHONY BOLTON: So if you work as we typically had with analysts for five, six, seven years or so, before they normally had the prospect to become a fund manager, you got a pretty good idea if you thought they could make it. Although just being a good analyst didn’t necessarily mean you could be a good fund manager. So we’d then help them. We had something we called PM Academy where we helped them.

ANTHONY BOLTON: With things like portfolio construction and stuff that they didn’t need to do as an analyst.

STEPHEN CLAPHAM: And how about the emotional side? Could you train somebody to?

ANTHONY BOLTON: I think you could sort of see that along the way. And if they were, if you didn’t think they had the temperament for it, then, you know, you had to be honest with them.

STEPHEN CLAPHAM: And if you were an analyst at Fidelity, how would you attract Anthony Bolton’s attention? What was the thing that made you jump on a stock?

ANTHONY BOLTON: I think that the first thing is, as I was saying, you know, we had fund managers doing different things. Income funds had different requirements. So they had to know the type of thing that I might be interested in. So they knew if they were coming to sell me, you know, an online growth stock done well for several years, that probably wasn’t going to be for me.

ANTHONY BOLTON: I think that, you know, they had to be put across succinctly why they were keen on it. And then there were probably certain, you know, certain things that I would latch on that would interest me. I was, before I decided to buy things, a lot of stuff that I’d look at, you know, fundamental stuff.

ANTHONY BOLTON: But, you know, I’d want to look at… I mean, one of the things I’ve always been keen on is looking at the shareholder list, because it told me if I was early or not. If I saw other investors that I rated on the list, that was a positive in some ways. But if there were lots of them, I knew I was coming to this late.

ANTHONY BOLTON: And that may be not a reason for not doing it, but I always had that at the back of my mind. And looking at… You know, direct to dealing was something I used a lot as a sort of name, or conflicting. But this whole amalgam of stuff was what I looked at, yeah.

STEPHEN CLAPHAM: And were there any you might not want to say, were there any people in particular that you followed? I mean, that you…

ANTHONY BOLTON: I think it’s difficult for me to say but I think, you know, there were… Perhaps the opposite. You know, in those days, there’s certain fund managers owned by large banks, you know, or some of the large insurance companies. I mean, things have changed, but, you know, some of them I wouldn’t rate that much if I saw them on the list.

STEPHEN CLAPHAM: It’s funny because I’ve written about this and it seems to me it’s like the only free lunch in investing. You’ve got a shareholder register and if you look and see who’s on it, it can be a huge benefit.

ANTHONY BOLTON: Particularly for private investors well i know i i totally agree and you know and you you see how they move their holdings if they’re above a certain percentage of the company. So I think that is really useful information. And it’s interesting, I find not many other people did look at share register. Another thing which is sort of connected that I think is important, and it’s a slightly different topic, but it links.

ANTHONY BOLTON: When people compare valuations on markets, I think there are two things they miss. The one thing is the mixture of sectors. So people will say this market looks cheap against that market. But what they then don’t look at is the sector dispersion. And so often that is really important in the relevant.

ANTHONY BOLTON: So I much rather looked sector by sector valuations across markets. Because I think that’s more meaningful. But there was a more subtle thing. There are markets that have most companies that are controlled, and markets that don’t. So most of the European markets, when I was dealing continental European markets, the companies are generally controlled.

ANTHONY BOLTON: The UK, contrastingly, most of the companies are not controlled. To me, that’s a big plus, actually, for the UK. And I think the UK, everything else being equal, deserves a premium. For these are companies that can be taken over. While if you’ve got a controlling shareholder, they can’t be taken over if the shares become too cheap.

ANTHONY BOLTON: So somewhere like Hong Kong, where there were some really cheap shares, some of the cheapest shares I’ve ever come across. There were property companies selling at 5% of their NAV, for instance, but they were controlled. And if the controlling shareholder wasn’t interested. In the share price, then it didn’t really matter.

STEPHEN CLAPHAM: Well, the people in the UK are a bit depressed by the, I don’t know if there are any UK fund managers in the audience, but we see the people who are very upset. But I saw Andy Brough last night say, he says, yeah, he’s single-handedly liquidating the UK stock market. He’s felt that he’s had a few bids.

STEPHEN CLAPHAM: Just going back to the analyst, I mean, how would you sort of Quickly assess whether the idea was good and what questions would you ask analysts?

ANTHONY BOLTON: It you know, did they have a convincing thesis? So that there had to be a thesis behind it And a logical thesis probably I’d been in the meeting with the company that they had. So did my, probably some of the most worthwhile discussions I had with the analysts was immediately after the company meeting and actually a disadvantage of doing too many meetings a day.

ANTHONY BOLTON: One was rushing from one to the other and you didn’t have the quarter of an hour after the meeting where you discussed what had changed and what was different and was the thesis still intact.

ANTHONY BOLTON: I hyperbole didn’t sell it to me. I mean, there were some analysts who had come to me and they’d put ridiculous price targets. You know, my price targets three times the current price. And they thought that that was a way of selling it to me. And it did the opposite, actually.

ANTHONY BOLTON: It just made me think, you know, that they don’t have a concept of what the real upside is or not. So it had to be true to me, if you see what I mean. It had to be true. And really important was they were telling me what they thought, not what they thought I wanted to hear.

ANTHONY BOLTON: And that, particularly the younger, less experienced analysts, would want their idea to be bought by Bolton. So they’d come along trying to pitch it. Along the line, they thought that was what I wanted to know. And if I saw through that, I’d say, look, this is to your disadvantage. I want to know what you think.

ANTHONY BOLTON: I will add on top of that. And the whole Fidelity way of doing things was to have these analysts who were the specialists, who knew the industry knowledge, who were normally less experienced in the sense they’d been. In the industry less time.

ANTHONY BOLTON: And then you got promoted on if you made it as an analyst and the PM thought you had it in with you to become a portfolio manager. When you became, you were a generalist. And so for the stock to end up in a portfolio, the analyst needed to be convinced and the portfolio manager.

ANTHONY BOLTON: So the specialist and the generalist. And I think that’s a very powerful combination if both are convinced. And, you know, there were. Stocks in the portfolio that the analyst had a different view from me, but most of the time we have the same views.

STEPHEN CLAPHAM: Oh really? So yeah.

ANTHONY BOLTON: Yeah.

STEPHEN CLAPHAM: And you mentioned earlier that you wouldn’t be interested in a growth stock that had already gone up a lot and been consistent for years. Were there particular sectors of the market that you favored? I know you did a lot in the transport sector.

ANTHONY BOLTON: I mean, I suppose I have more that very Capital intensive sectors generally I wasn’t so keen on. The airlines for instance generally so I missed things like Ryanair and EasyJet etc.

STEPHEN CLAPHAM: But you made a lot of money in shipping.

ANTHONY BOLTON: But in shipping yes but that was sort of spotting the cycle and buying tankers when they they were near their breakup value. I mean, upside downside is really important to me. And, you know, balance sheet analysis, et cetera, which is obviously your forte.

ANTHONY BOLTON: And asymmetrical return, something that didn’t have too much downside, but might have a lot of upside. That’s what I… Really took me on in investment terms. So I was always looking for that. And therefore, you know, stocks that I could sleep well at night. So spotting the anomaly is easier than knowing when it’s going to work.

ANTHONY BOLTON: So I needed to have time on my side. And that’s why I like this sort of asymmetry of return. Now, you know, the upside didn’t always happen. And maybe you were hoping certain things, you know, would work out.

ANTHONY BOLTON: Fit and and they didn’t but if you protected the downside and come right back to my first point avoiding the losers is is so important i still managed to have lots of losers but well do you know what your hit rate was pardon my hit rate i i don’t actually because we didn’t measure it in those days and would it if you’d known would it have made any difference probably probably not i somebody This is interesting.

ANTHONY BOLTON: This is probably very untypical these days. You know, I didn’t look at my weekly performance. I didn’t. I think it only sort of depresses you. I didn’t, you know, when you’re not doing well.

ANTHONY BOLTON: And so I didn’t look at a lot of the things that nowadays people do. I knew, you know, I had high tracking error and all these things. But it wasn’t something that was built into the way that I ran money. Probably wrongly, actually. Probably it might have helped me, you know, if I had more access to those things.

STEPHEN CLAPHAM: You didn’t need a lot of help, to be fair.

ANTHONY BOLTON: Well, yeah.

STEPHEN CLAPHAM: But you were running a retail fund.

ANTHONY BOLTON: Yes.

STEPHEN CLAPHAM: And so there must have been inflows and outflows. And you must have had the marketing department. Was there a lot of… Internal pressure?

ANTHONY BOLTON: Internal pressure and respect.

STEPHEN CLAPHAM: Well, if you’re doing badly and there’s outflows, I mean, it’s a business, right?

ANTHONY BOLTON: Yeah, no, there’s always pressure. And I made a decision when the fund got so big that I thought it was to the detriment of the performance. I made a decision that Fidelity went along with was to split the fund.

ANTHONY BOLTON: Fidelity Special Situations Month, the one I ran for 28 years, was to split it into two, into a global special situations and a UK special situations. And that was very controversial. And business-wise, it was a very bad decision, actually, because it immediately led to people selling who they didn’t want to have both parts of it.

ANTHONY BOLTON: But I felt at the time that was the right thing to do, you know, for investors, because I felt. That was me saying, you know, capacity is a problem and the fund is now. It was at one stage, I think it was five times bigger than the nearest fund or something. It was, you know, that’s just really difficult.

STEPHEN CLAPHAM: But the problem then was that the investor didn’t know who was going to run the global part. Was that not the issue?

ANTHONY BOLTON: Well, no. I mean, I was part of the process who picked who was going to run it, and we announced it. The other thing we did, we announced it quite long in advance, which I felt was the right thing to do.

ANTHONY BOLTON: From a business point of thing actually it’s totally the wrong thing to do it’d be much better and even like announcing when i was going to retire it would have been much better for me to say one week oh i’m retiring next week because if you give you know people six months nine months a year pre-announce your retirement it gives the competition huge potential to say oh no And then by Anthony’s fund, you don’t know what the new manager is going to be like, you know.

ANTHONY BOLTON: Why did you tell him? I thought it was the right thing to do.

STEPHEN CLAPHAM: So you always put, it was always integrity before profit.

ANTHONY BOLTON: With me, that was important. You know, I felt to leave people in the lurch just wasn’t something I felt comfortable with.

STEPHEN CLAPHAM: I was watching the Roger Federer documentary on the plane coming back last week and he he was talking about rod laver being a brilliant tennis player but not making any money and i was just wondering if you had these of course Federer has made a huge amount of money i just wondered if you felt that the money being paid today has just got a bit out of hand? You know the pod shops are paying 10 million dollar up front bonuses, guarantees, and I am available if there are any pod shops looking.

ANTHONY BOLTON: It’s, yeah, I mean, I, how, what would I talk about this? I did well enough for myself and my family. I… I remember, you know, people tried to poach me. I remember Soros trying to pinch me at one stage and, you know, promise me the earth. And I think he left the meeting. It was lunch. And I think he left at the end. He said, you Brits, you’re not interested enough in money. Something along those lines. And, yeah, obviously the money is important. But. But you’re asking me, is the money too big or too small? It was like, I can’t tell you. It was, I, you know, we were always being asked, you know, do you think this management team is being paid too much or too little? And my view of it, it may be different actually from some of my colleagues, was that it’s not our job to say what is too much. What I was interested was the shape of pay.

ANTHONY BOLTON: I didn’t want to pay for failure, paying for success, but mandating that X is too much for a CEO, I just felt really uncomfortable.

STEPHEN CLAPHAM: But there is an issue here because if the pod shops are paying up, then Fidelity has to compete with that.

ANTHONY BOLTON: Oh, yeah. No, I’m not saying money isn’t important and relative money is really important.

ANTHONY BOLTON: And look, I think if money is the most important thing to them, then they’re going to be a difficult person to keep. But I think there are other things that places like Fidelity offer that are very important.

STEPHEN CLAPHAM: What sort of things?

ANTHONY BOLTON: Well, it’s working with a group of people that you enjoy working with.

ANTHONY BOLTON: And I’m not saying that money is bad at Fidelity. Yeah, but I’m only a lawyer. Of course it’s not.

STEPHEN CLAPHAM: No, I just think it’s an interesting issue because, of course, if the rewards get very skewed, then you suck the talent.

ANTHONY BOLTON: And it was, yeah, and again, I saw it in the corporate world, you know, that so much of the good management was going off to private equity. And I thought that was very… That was not good news for us who invested in listed companies. And that was also a reason that I didn’t want to jump on the bandwagon of saying, you know, this CEO’s salary is too high. Because the alternative is they’d leave the listed sector.

STEPHEN CLAPHAM: You had some great stories in the book about some of the company visits. Do you remember any of them? I like the one about the Spanish CEO with the bodyguards.

ANTHONY BOLTON: Torres Sustent, yes. This was a Spanish conglomerate. Do you want me to tell the story?

ANTHONY BOLTON: It was a sort of go-go conglomerate, and we went to visit it.

ANTHONY BOLTON: We, I think in Barcelona, can’t remember. And we had this meeting with the chief executive. And it was one of those meetings, he had a phone sort of under his desk. And, you know, every five minutes it rang and he would stop the conversation and he’d talk away and they’d put it down. And that I didn’t particularly like. But we’re into Lush. He said, oh, you know, I’m taking you for lunch. And that was great.

ANTHONY BOLTON: So we thought we’d have more time to talk about the business. And it was on a big square. Well, I say a big square. It was actually not that big a square, but where sort of four roads intersected each other. And outside the front, I should have said, when we went into the office, the first thing we saw was a guard, an armed guard on the door. Which slightly worried me. Anyway, he took us to lunch.

ANTHONY BOLTON: We got into his car. I thought, well, we’re going to drive, you know, a mile or so down the road. Well, we drove to the other side of the square and got out to the restaurant. And that, I just thought, well, anyone who can’t walk across the square feels that he needs to be protected. And actually, it ended up as one of the big, biggest bankruptcies, you know. Corporate bankers in Spain at that time.

STEPHEN CLAPHAM: I know there’s loads of people here who’ve got loads of questions. Who wants to ask the first question?

AUDIENCE MEMBER: I don’t know if you have any children, and apologies if you don’t, but I was curious as to what investment advice you gave them when they started out in adult life. The analysts. No, your children. My children. Sorry, I missed the most important part. Yeah, it’s been sad to me. None of my children have been interested in coming into the investment business.

ANTHONY BOLTON: I’ve got a daughter and two sons. My two sons, the eldest son in particular, is quite entrepreneurial. And so I’ve tried to help him with his business. And we were talking, I was talking to someone else here about sons and entrepreneurial tendencies. And it’s been mixed, to be honest.

ANTHONY BOLTON: He’s had some things that have gone okay and some things that haven’t. But, you know, the general advice on life, I mean, to give it your all, I think, and is to try. Even if you fail to try, I think in life, if you… If you don’t have a go, you’ll always regret it. People say, why did I go and run the China Fund?

ANTHONY BOLTON: And it was something, when I started going to China and seeing what was happening there, I got really excited about it. And I, you know, I don’t regret it, but I think if I hadn’t done it, I would have always been sitting there thinking, you know, why didn’t I give it a go? Sorry, that’s probably not enough specific advice.

AUDIENCE MEMBER: Hello. Thank you for your talk. Yeah, could you talk a bit on how you managed the overall risk of the portfolio? So did you have like a threshold of risk contribution from the single names or what have you? You didn’t look at it at all. How would that work? Yeah, no. So this, I was sort of again a bit before the sort of risk analysis that we have today.

ANTHONY BOLTON: Risk to me was much more particularly about balance sheets, which I mentioned, because that nearly always, when something went wrong and I lost a lot of money, it had a weak balance sheet.

ANTHONY BOLTON: And it’s the sort of thing you sort of shoot yourself after. You know, each time you say, why do I keep doing this? And anyway, after a bit, you try and do it as little as you can. People, you know, the other dangerous thing, and particularly when you get into the emerging markets, well, the only one I know is China.

ANTHONY BOLTON: In detail is investing with people who you don’t trust, you know, who don’t have integrity. That is really important in terms of risk. Then there are the sort of hidden, yes, I think where it helps, where you take unintended risks. There is some commonality that, you know, all the stocks benefit from a particular currency.

ANTHONY BOLTON: Moving up or down and you haven’t realized how much of that that that’s important so to try and you know unless you particularly wanted to take a big view on the dollar or whatever it was not have an unintended bet i think that that was important to me some knowledge of the industries you know, more risky industry. I mentioned Capital intensity as something I didn’t like.

ANTHONY BOLTON: Cash flow, free cash flow was something that really appeared to me. But it was more those sorts of things than some of the very sort of risk-orientated stuff, you know, and the… That companies change, but often people don’t change.

ANTHONY BOLTON: I think one of the things I say in the book, you know, with management, I remember always with Maxwell, he came back in a different guise and he said, I’ve learned my lesson and I’m not going to, you know, be a good boy and do everything right. People generally don’t change. So learn that. So that’s a way of avoiding risks.

ANTHONY BOLTON: Another thing I say on management, it’s interesting. I remember there was a company that we held. It was an oil exploration company. And we knew there was a bit of controversy about the management. But anyway, we believed in, we thought the story and what there had been.

ANTHONY BOLTON: And I’ll tell you something that’s really good. Always try and hear the other side of the story. So I found a fund that was short of the stock, and I met with the manager to hear their side of the story. And he only got through about 10 minutes of telling me why I was wrong and he was right.

ANTHONY BOLTON: And I realized that he was 100% right and I was wrong. And… I think that’s really so, perhaps a different thing. I think it’s really important to know the counter thesis of a stock that you own and to be able to address why you think that is wrong.

AUDIENCE MEMBER: Thank you very much for your time tonight and sharing your experiences. I was just wondering, looking back, is there any types of investments where you made the choice that you look back and think, add a certain edge to it that came up more often than not?

AUDIENCE MEMBER: Made a successful investment and I don’t know if it might be a strong balance you like you mentioned there or management and also just also very library mistakes or any kind of common mistakes think most people make an investing that to avoid thank you so of the sorry other things in terms of mistakes common states you think are made by people when they make an investment what are common mistakes that other people make yeah and also is there any kind of edges that you think certain investments had which were more successful than others that you look back on it came up quite a lot gosh i think it’s i think it’s really important to know as.

ANTHONY BOLTON: As i was saying about popularity being risk so that that so i didn’t mention it in terms of risk When things are very popular and they’re very over-owned, that is risk. I think you just need to be aware of it. And I’m not saying you shouldn’t invest in those sort of situations, but you should be aware of the risk that you’re taking in those situations.

ANTHONY BOLTON: What do other people want? Make. This is slightly different. I think one mistake people make in general, they’re always talking about the outlook. And this often with markets, they say, well, the outlook is good, or the outlook is bad. You see it at the moment. The outlook is good for America. The outlook is bad for China. That’s not what this industry is about.

ANTHONY BOLTON: What we’re about is view of the future is discounted in prices today. So it’s about, of course, it is about the outlook in the long run. But more important is what outlook is discounted in prices. So when I come to a company, the same thing. It’s about the outlook, but what outlook is already discounted in the valuation of that stock today. And I think that’s really important.

ANTHONY BOLTON: If you were starting your career today, would it be in UK listed equities? Yes. I mean, this is one of the great opportunities.

ANTHONY BOLTON: And yeah, you know, I want to be more global than I was because we’re in a global world. And, you know, I was lucky to extend into… Into the rest of Europe fairly early in my career. And that was fascinating.

ANTHONY BOLTON: And then I had this sort of last chapter in four years in Hong Kong running China, which was fascinating, which was really interesting. That people always want about, you know, they want the opportunity and they want the capitalist.

ANTHONY BOLTON: But occasionally you get that. You see a really good opportunity and you see a very clear catalyst to make it happen. But in my experience, if there’s a clear catalyst, there isn’t the opportunity because the stock has already moved to anticipate it.

ANTHONY BOLTON: So I think catalysts, I always rather have a portfolio a spread of things that I thought were really cheap and really undervalued, even not knowing always what the catalyst was going to be. And that’s what I felt most comfortable learning. Maybe it comes back to my nature. Something about my nature that I was attracted to those. And my experience was that if you were patient, that they worked.

ANTHONY BOLTON: Whether it was corporate activities, we’re seeing more in the UK. So, but I think behind you, you know, there are probably two questions. I think I would be more, if I was started in the business today, I think I wouldn’t want to just focus so much on one market. On the other hand, I do think there’s a specific opportunity in the UK today.

STEPHEN CLAPHAM: I mean, would you want to do equities? 50% passive? Would you not want to do VC?

ANTHONY BOLTON: No, because VC is all about, you know, VC is just the weighing machine.

ANTHONY BOLTON: Equities is the weighing and the voting. And it’s the combination of the two that I think makes it such a fascinating business. There’s nothing wrong with private equity. I mean, that’s interesting. But I think equities is even more interesting. I certainly wouldn’t want to do bonds, but I think equities are just so interesting.

ANTHONY BOLTON: And the other thing is it takes you, it puts you at the vanguard of all the most interesting developments in the world, corporate developments in the world. You see them early and you meet some of the most interesting people in terms of the people managing the company. So. I still think it’s the most extraordinary job.

AUDIENCE MEMBER: I’m just very curious to hear about, I think we spoke then just now about the rise of index investing. Also, we touched on pod shops in the talk. So when the appetite for allocators is probably lower now for equity investors who are having consistent drawdowns, how do you then adapt to a contrarian approach around that, how the industry has evolved?

ANTHONY BOLTON: Yeah, I mean, the trouble…

ANTHONY BOLTON: The trouble with the contrarian approach is that it seems to me the periods, the momentum periods are longer these days. And that is partly due to the advent of passive funds, index funds. And it means, you know, you get these periods as we’ve just been in when value is done really poorly. And I was reading, I think, you know, that I think it was that the group, the 20%.

ANTHONY BOLTON: Cheapest stocks in the world are cheaper today than any time on a relative basis, any time than they’ve been, I think it was the last 30 years or something of that. I think that’s really interesting. And that is where I put my money and want to have my money. But, you know, You know, there’s going to be a day of reckoning because, you know, the U. S. Is 67% of the world.

ANTHONY BOLTON: So people who are investing globally, they’re putting 67% of their money into the U. S. And a big chunk of that is into technology.

ANTHONY BOLTON: All the stuff about the US market and, you know, I’m not as on top of things as I used to be, but all the stuff I look at, yes, you know, this is very near a top.

ANTHONY BOLTON: And that’s going to drag down all the passive funds with it when that bursts. And it’s going to be a difficult time. It’s going to be very good for the active investors, in my view, in that environment.

ANTHONY BOLTON: But, you know, to me, all the red lights are flashing on somewhere generally like the U. S. Now, within the U. S., there’s such a big market. There are areas that will back the trend. But that’s what I think.

ANTHONY BOLTON: And today, a question from me. Top down, macro, I used to go into Fidelity. You would occasionally turn up for the meetings. I have no idea why you used to turn up for the meetings. So, did you have some? View on macro conditions? I didn’t. I never liked to have a macro view of the world dictate the whole portfolio.

ANTHONY BOLTON: And I thought that was, you know, to have one view of the world. On the other hand, not to have some views, I felt was, you know, I had to, and I like to listen to a spectrum of views out there. And it would influence things at margin.

ANTHONY BOLTON: So I wouldn’t want to put a big bet on my macro view, but it might make me, if I had two things that otherwise were equally attractive and one fitted more into what I thought my macro view was, then I’d probably buy that one rather than the other one, if you see what I mean. So it was in that amalgam of stuff that I was considering, but it wasn’t. To me, the Beale and End Oil of it.

ANTHONY BOLTON: And I mean, the extrapolation of it is, and it’s certainly not what you look at, but the Fed watching, the thousands and thousands of investors are trying to second guess the Fed.

ANTHONY BOLTON: And I said, look, what competitive advantage do I have in that? I have nil. I would much rather put my money on stuff where I think I have a competitive advantage against other people in working out that this company is attractive or this one. And that’s what I wanted to invest in.

ANTHONY BOLTON: Hi.

AUDIENCE MEMBER: Ian Fraser, yeah. I think it was 2003 you were nicknamed the Quiet Assassin. I’m not sure who by it, but apparently it was for the way in which you maneuvered behind the scenes to ensure that Michael Green did not become chairman of the enlarged ITB. Were there other instances where you maneuvered behind the scenes to ensure that someone lost their job or… Or else was not appointed to the job which they were supposed to be appointed to.

STEPHEN CLAPHAM: And what would make you go active?

ANTHONY BOLTON: Okay, let me talk about that because this is interesting. So one of the things, as my funds started to get bigger, as we touched on, there are a lot of disadvantages of running very large funds. There are some advantages. And it got me… More interested in becoming more active as an investor.

ANTHONY BOLTON: Because I thought, if we could help make change for the better and improve the companies that we were invested in, then that was… Going to help us and it was something that we would have more influence than someone running a small fund would have.

ANTHONY BOLTON: We nearly always did it behind closed doors. I’m totally convinced that the most productive discussions with companies when you’re trying to influence them on what they should do and normally it was about the management. Or it was about strategy.

ANTHONY BOLTON: The best conversations you have are behind closed doors. Sadly, ITV got into the public domain, I think partly because it was media companies that we were in debate about. And so to answer your question, yes, there was quite a lot of that we were doing. But if you do want to do that, My observation was it’s very time consuming and it also locks you into the company for a while, quite a period of time, which might be fine.

ANTHONY BOLTON: And often with me, that’s fine because of my holding periods was normally in years, you know, rather than months. But I remember there was a particular company where we really thought that the CEO was not up to the job. And we thought, well. How can we change things? And what we managed to change the chair of that company. We thought, well, if we change the chair, then they can look at the board and change it.

ANTHONY BOLTON: So the new chair came in and he said, well, you know, I’m not sure if I agree with you. I need some time to work out whether you’re right or wrong. We said, okay, fine. Well, a year later, he comes back and he says, well, you were right. We’ve got to change the CEO. So it can be a very long process, I’m trying to say. But I think it can be productive.

AUDIENCE MEMBER: I’m Robert Schneider. Thanks for your presentation. As a Fidelity customer, it’s appreciated to put a face in front of the business. I’m wondering if you could compare and contrast your role as an investment advisor or fund manager versus the CEOs and senior executives of the companies you’re investing in or not investing in.

AUDIENCE MEMBER: I think it was partially addressed by the previous question, but there’s a difference in stock price valuation versus making money with the assets that the company has. I wonder if you could comment on that.

ANTHONY BOLTON: I’m not sure if I understand the question, to be honest. But you’re saying there’s a difference, obviously, between running a company and, you know, producing a stream of profits to what we do as an investment manager.

SPEAKER 7: That’s my assertion. It might be wrong, but that’s you.

ANTHONY BOLTON: You’re 100 percent.

AUDIENCE MEMBER: I mean, that your your your business is in. Investing for the basis of your customers to make a profit on the stocks versus the CEO’s job is to maximize the investment of their investors slash the business. And there is a difference, in my opinion. Could be wrong, but I’m just wondering what you think.

ANTHONY BOLTON: Yeah, I agree with you. There is a difference. They’re different activities and require different type of… Type of person to be successful in age.

AUDIENCE MEMBER: Thanks for your time today. There’s a lot of discussion about the state of the UK listed markets and I don’t know how close you are to the policy discussions around that, but in the sort of disinvestment by the corporate pension funds over the years, somewhat on your watch, sort of de-risking of the corporate pensions in the UK away from equities.

AUDIENCE MEMBER: The suggestions almost mandating a certain allocation to the UK equities, which were discussed. Luckily not introduced. How do you think of, what is the right answer? Are you any close to any of those conversations given your history?

AUDIENCE MEMBER: Can you just say that the corporate pension funds.

ANTHONY BOLTON: Should they post investments?

AUDIENCE MEMBER: It’s not specifically on that. It’s just more of a sort of, how do you fix some dysfunctional.

ANTHONY BOLTON: UK listed market today? So you’re not talking about the capitalists. As is well known, pension funds and insurance companies have one of the lowest allocations to the domestic market relative to anywhere else.

ANTHONY BOLTON: As you’ll see, the government said, we’d like this to change. They haven’t mandated anything.

ANTHONY BOLTON: I think if it doesn’t change, they probably will, rightly or wrongly. I mean, that’s very debatable whether it’s something they should be doing or not, I think. But I think it looks to me as that they probably will.

ANTHONY BOLTON: Will this make a big difference? It’ll make some difference. But obviously, a lot of that sort of pension fund money.

ANTHONY BOLTON: Has moved away from equities, you know, to de-risk, has been de-risked. I mean, whether that’s a good thing or a bad thing is a different conversation. But those sort of funds probably will never come back into the equity market. But it seems to me, you know, that in many other countries, the domestic funds tend to have about 20% of their money.

ANTHONY BOLTON: In the domestic market, why the UK has got down to four seems strange. Now, look, if I’m right about the future and something big is going to change in the world with a view about America and index funds and stuff, that’s going to be a catalyst to change very much how people think about investing. So I think that’s probably going to be a catalyst that changes the a role of the UK.

AUDIENCE MEMBER: Very, very quickly, Anthony. You said that you’re contrarian and unfashionable. In order to be unfashionable, you’ve got to have a sense of fashion and to know what the way herds and people act. Do you think that you have a particularly good sense of herd mentality? And is that key to your success?

ANTHONY BOLTON: Yes, but you’ve got to… But herd mentality, you’ve got to measure. So you’ve got to measure popularity. You’ve got to measure, you know, over-ownership. All the sort of sentiment indicators that people look at, that’s what I think. I think an investor who doesn’t look at those is really missing something quite important. You know, short interest is something I’d look at.

ANTHONY BOLTON: Insider buy it’s interesting America you’ve got record insider selling of the American market i think that that’s an important indicator to me so yeah you you definitely look at the stuff call ratios that all that sort of stuff which indicates the sentiment and popularity okay so listen when i announced this event you.

STEPHEN CLAPHAM: One of my clients, who is a former Fidelity PM, wrote an email to me. He said, I noticed that you had Anthony coming on to the podcast in a couple of weeks’time. I was incredibly fortunate to have worked closely with Anthony when I joined Fidelity and then to have had him as a mentor when I began managing portfolios. He has an exceptional mind, a natural, insatiable curiosity for stocks, and is quite simply… The bravest fund manager that I’ve ever met. More than that, he’s a wonderfully kind, courteous and generous individual. And I can’t thank him enough for the advice and wisdom that he shared with the investment team. And I’d like to thank you for sharing that wisdom with us this evening. It’s been really fun. Thank you.

ANTHONY BOLTON: Okay.

RUSSELL NAPIER: So I get to say the good bit. Please join us for drinks, sponsored as ever by Kenox Asset Management. And thank you all for coming in, particularly for Anthony and Steve for coming all the way from London. Thank you.

STEPHEN CLAPHAM: When I announced I was interviewing him, one of Bolton’s former colleagues had this to say. I noticed that you had Anthony coming on to the podcast in a couple of weeks time. I was incredibly fortunate. To work closely with Anthony when I joined Fidelity, and then to have had him as a mentor when I began managing portfolios.

STEPHEN CLAPHAM: He has an exceptional mind, a natural, insatiable curiosity for stocks, and is quite simply the bravest fund manager that I have ever met. More than that, he is a wonderfully kind, courteous, and generous individual. And I can’t thank him enough for the advice and wisdom that he shared with the investment team. I had a similar experience. I sent Anthony my book.

STEPHEN CLAPHAM: He came back with some incredibly perceptive and valuable comments, highlighting where he agreed and where he disagreed. It was an incredibly generous gesture from someone whom I hardly knew, and I was really delighted that he took the time and trouble. Praise from someone of Anthony’s caliber felt really special.

STEPHEN CLAPHAM: As ever, I hope you enjoyed this episode, and do go visit the Library Of Mistakes in Edinburgh, or at least visit their website and drop a little money their way. It’s a worthwhile cause which listeners of this podcast should support. Thank you for listening.