Episode #507: Thomas George, Grizzle – Disruption at a Reasonable Price
Guest: Thomas George, President of Grizzle and Portfolio Manager of the DARP ETF
Date Recorded: 10/25/2023 | Run-Time: 50:37
Summary: In this episode, Thomas George discusses the concept of investing in disruption at a reasonable price. He talks about the sector and thematic focus of the ETF, as well as the lessons learned from the 2022 sell-off in growthier parts of the market. Additionally, he dives into the performance of Amazon since its IPO and highlights why it serves as a perfect case study for disruption at a reasonable price.
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Links from the Episode:
1:23 – Welcome Thomas to the show: For more information, prospectus, risks, and holdings of the Grizzle DARP ETF, click here
2:07 – Thomas’ experience in portfolio analytics
7:39 – Transitioning to quantitative investing
10:22 – Founding Grizzle in 2018
13:44 – Understanding disruption at a reasonable price
18:25 – Themes Grizzle is focused on in late 2023
28:00 – Thomas’ approach to position sizing
31:42 – The benefits of a fundamental & quantitative approach
33:50 – Investing in natural gas and electric vehicles
36:00 – Standout areas in traditional tech
40:13 – The landscape at Grizzle
44:31 – Analyzing the Amazon case study
Learn more about Thomas:
Twitter; Grizzle Research; Grizzle Investment Management
Transcript:
Welcome to the Meb Faber Show, where the focus is on helping you grow and preserve your wealth. Join us as we discuss the craft of investing and uncover new and profitable ideas to help you grow wealthier and wiser. Better investing starts here.
Disclaimer: Meb Faber is the co-founder and chief investment officer at Cambria Investment Management. Due to industry regulations, he will not discuss any of Cambria’s funds on this podcast. All opinions expressed by podcast participants are solely their own opinions and do not reflect the opinion of Cambria Investment Management or its affiliates. For more information, visit cambriainvestments.com.
Meb: Welcome, my friends. We have a great episode today. Our guest is Thomas George, the President of Grizzle and Portfolio Manager of the DARP ETF. In today’s episode, Thomas talks about investing in disruption at a reasonable price, focusing on the keyword “reasonable.” He discusses the sector and thematic focus of the ETF and shares insights from the 2022 sell-off in growthier parts of the market. As we wrap up, he walks us through the performance of Amazon since its IPO and explains why it serves as a perfect case study for disruption at a reasonable price. Please enjoy this episode with Thomas George.
Thomas, welcome to the show.
Thomas: Thank you, Meb. It’s nice to be here.
Meb: Where are we finding you today?
Thomas: I’m in Toronto. It’s a great town.
Meb: You’ve got interests in a variety of different areas, making it hard to categorize you as an investor. Can you share a bit about the origin story of Grizzle and how you got to where you are today?
Thomas: I studied engineering at Waterloo, but I caught the bug for stocks and Bay Street during my internships. I started at Citi doing back-office work for derivatives trading, but I wanted to experience the front office. I eventually landed a tech assistant position at TD on a six-month contract. I turned that opportunity into a full-time role in portfolio analytics.
Working on a trading desk was an incredible experience. The energy and excitement were unparalleled. It became the foundation for what I do today. I value the skills I developed in portfolio analytics, as it taught me a lot about position sizing and portfolio math.
Meb: That’s fascinating. So, where did you go from there?
Thomas: After my time in portfolio analytics, I transitioned into quantitative investing. In 2018, I founded Grizzle, which focuses on investing in disruption at a reasonable price. We explore different sectors and themes, including areas outside of tech, like energy and uranium.
Meb: That’s interesting. Can you elaborate on the concept of disruption at a reasonable price?
Thomas: Disruption at a reasonable price means investing in companies that have the potential to disrupt industries or markets, but at a valuation that is reasonable compared to their growth prospects. It’s about finding opportunities where the price doesn’t fully reflect the disruptive potential.
Meb: What are some of the themes that Grizzle is currently focused on?
Thomas: In late 2023, we are focused on several themes, including natural gas and electric vehicles. We also see standout areas in traditional tech that offer exciting disruption potential.
Meb: How do you approach position sizing in your investments?
Thomas: Position sizing is an important aspect of our strategy. We take a fundamental and quantitative approach to determine the appropriate size for each position. It’s a combination of evaluating the company’s fundamentals and assessing the potential for disruption.
Meb: What are the benefits of using a fundamental and quantitative approach?
Thomas: Using a fundamental and quantitative approach allows us to combine the best of both worlds. We can analyze the fundamentals of a company and its disruptive potential while also incorporating quantitative models and data. It provides a more comprehensive view of the investment opportunity.
Meb: Are there any other areas outside of tech that you find interesting?
Thomas: Yes, we are currently interested in investing in natural gas and electric vehicles. We believe there is significant disruption potential in these areas, and the valuations are reasonable compared to the growth prospects.
Meb: Can you share any standout areas within traditional tech?
Thomas: There are several standout areas within traditional tech that we find interesting. However, I would prefer to keep those specific areas within our research at Grizzle.
Meb: Fair enough. Can you give us an overview of the current landscape at Grizzle?
Thomas: At Grizzle, we are constantly researching and exploring investment opportunities in disruptive companies. We focus on finding disruption at a reasonable price and aim to provide our investors with compelling investment options.
Meb: Lastly, can you discuss the Amazon case study and its relevance to disruption at a reasonable price?
Thomas: The performance of Amazon since its IPO serves as a perfect case study for disruption at a reasonable price. It demonstrates how a company can disrupt an industry and deliver significant returns over time. Analyzing Amazon’s journey can provide valuable insights for investors looking for disruptive opportunities.
Meb: Thank you, Thomas, for sharing your insights on disruption at a reasonable price. It has been a pleasure having you on the show.
Thomas: Thank you, Meb. It was a great discussion.
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