Canadian value investor François Rochon says stock investors should behave like artists, independent in their thoughts and actions. If the stock selection process is rational, investment returns will eventually follow.
A follower of the Ben Graham and Warren Buffett philosophy, Rochon is the president and portfolio manager at the Montreal, Canada-based Giverny Capital and has been responsible for amassing exceptional investment returns with his portfolio yielding 15.7 per cent CAGR since inception.
Why investment is an art, not science
Francois, an engineer by education, finds the rigidity and precision of engineering to be a handicap to successful investing. He feels engineering and investing are almost diametrically opposite, as there is no precision in investing and it is more instinctive in nature.
Quoting Nikola Tesla, he says: “Instinct is something which transcends knowledge. We have, undoubtedly, certain finer fibres that enable us to perceive truths when logical deduction, or any other wilful effort of the brain, is futile.”
An investor can be considered successful even when wrong 40 per cent of the time, but an engineer can’t afford to go wrong for even 0.4 per cent of the time. Which is why Rochon sees investing as more of an art than science.
He says to be a successful value investor, it is necessary to ‘master the art of investing’.
“To master any art form, begin with what you love. You’ll need to study the art’s masters, and as a painter paints, you must invest. You’ll develop your own unique style, an independent