Differing Opinions

I have been exchanging emails over the last couple of days with a friend of mine who also manages money. We have been volleying back and forth about what the market has done and will do, or so we think. He and I have completely different opinions about what the risks are to the market and what is likely to happen over the next few months. Looking back he has been less right than I have about a couple of themes and while his returns are good he has lagged my results slightly. I believe that is a short term phenomena that would favor him as often as it would favor me and as such is inconsequential. The bigger point is that we had a lot of the same training when we worked together a few years ago. That training has lead him down one path of portfolio construction and analysis and I have taken a much different route. I suppose one of us could evolve to have better results than the other but I am intrigued by differences that exist. There really is two sides to every trade.

This is constructive to think about because I know I can learn from my friend. I don't know if he tries to learn from me or not, and I don't really care about that. I would suggest never under estimating anyone ever. Perhaps if the Yankees had followed that advice they would not have lost. Who knows?

I will conclude the Switzerland commentary tomorrow.