The Investment Insights of Charles Ellis, a Financial Legend for 60 Years

Part 1 of 2
The ancient Greek philosopher Heraclitus said, “There is nothing permanent except change.” Charles Darwin certainly observed that in his trailblazing work on evolution more than 2000 years later. In a quote widely attributed to him, he is alleged to have commented, “It is not the strongest of the species that survive, nor the most intelligent, but the one most adaptive to change.”
As the markets fluctuate around us, how much should investors change?
This week’s guest has his own historical perspective on that question because he has lived through a momentous evolution in the markets. He is Charles Ellis, whose storied career started on Wall Street in 1963 after graduating from the Harvard Business School. He was a skeptical analyst during the go-go years of the 60s and founded Greenwich Associates, the top Wall Street consulting firm to major investment firms, institutions, and governments.
He was an influential board member of Yale’s endowment advising its legendary head, David Swensen. He’s taught advanced investment courses at both Yale and Harvard. And he has authored 20 investment books, including the classic, Winning the Loser’s Game, now in its 8th edition, and the recently published Figuring It Out: Sixty Years of Answering Investors’ Most Important Questions, which we will discuss in this week’s exclusive TV interview.
In the first of a two-part interview, Ellis will discuss the most significant changes that have occurred in the markets and what they mean for investors.
00:00 Hello!
00:29 Introduction
02:02 Interview with Charles Ellis
24:35 Action Point
#longterminvestment #investingstrategy #investingtips
WEALTHTRACK #1920 broadcast on November 11, 2022
More info: wealthtrack.com/sixty-years-o...
Bookshelf:
Winning the Loser's Game: Timeless Strategies for Successful Investing
amzn.to/3AbA9Nt
Figuring It Out: Sixty Years of Answering Investors’ Most Important Questions
amzn.to/3UsNnxC

[@bernhardklinger4839]

Great Interview! Charles Ellis is phenomenally intelligent and eloquent!

[@benscott4505]

Consuelo, you are to be commended for showcasing this man’s wisdom! This interview was just a homerun!

[@mikesmith-nj1ij]

Winning the Losers Game. A. Charles Ellis classic! Looking forward to this interview.

[@iamkerenlouise]

This man is a sage and wise investment powerhouse and legacy - I will read his book!❤ thank you for having him! He is still very sharp as a tack at 85! Wonderful!

[@Jacobkeirnnfsk]

His previous books are terrific as well.

[@RWROW]

Thanks for this interview with Mr. Ellis. His advice is invaluable for any ordinary investor.

[@wholeNwon]

I recommend his and John Bogle's books to new investors.

[@anandpatel2624]

“Knowing thy self” what an amazing thought and absolutely well explained. Love the down to earth explanation. That mother’s return of investment was the children being this successful to be interviewed!!! ❤👏👍

[@SY-jq4yw]

Thanks for Charles’ wisdom.

[@brianhollenbeck8633]

Having responsible parents that prepare for their children's future is a blessing. Not that I would know.😇👑🌍🌏🌎💚

[@ednan9]

Another great show by Consuelo- Thx

[@awalton9024]

Ellis says: "90% fail to keep up with the market)..etc. Simply put, if you take the other side of that bet you have a 90% chance of exceeding the market. An understanding of probability was my takeaway from business school and it has stood me in good stead. Ellis is always worth listening to but you have to listen very carefully to really aprehend what he's actually saying.

[@mtaqavi1408]

Thank you for this really informative video!

[@nkunam]

9:22 Charles Darwyn would be fascinated by the amount of greedy and incompetent people still employed by the financial industry and investment management industry in particular. 90% of investment managers are serial underperformers and yet 99% of the managers get to keep their jobs. The entire hierarchy is driven by negative selection, and to quote Ron Desantis "There are so many worn-out greedy idiots (donkeys are lovely animals, and so I don't want to say donkeys and insult the donkeys) that need to be put out to pasture"

[@yoshortyb]

It is pretty incredible how many people work in investment management earning 7 figures doing absolutely nothing of value. How is it possible they can still get assets?

[@mikkimikki5376]

So very interesting. Appreciate this kind of history lesson. ✨💫✨

[@jessyjames7508]

LOVE how Mr. Ellis thinks about investing, especially at his age. Zero bond position--that's truly investing and very contrary to to conventional portfolio thinking.

[@mikejohnson4617]

"All of us have Bloomberg terminals"??? I had to look up what it was. Sounds like the starting point is $20k per year. Not at my house.

[@supersteve8305]

My first investment in 1988, I had to call a trader and pay a $75.00 commission on a $250.00 investment. Now I could make a $250.00 (or whatever) trade, and pay nothing. Things have come a long way.

[@michaelfelli7661]

Then, it was called investing. Today, its called speculating.

[@jakejake7289]

I remember those days. It used to kill me to pay those commissions to Shearson Lehman. I didn't have much money.

[@craigwroten190]

They would have you believe that it costs nothing

[@youtubebystander9294]

So much ideas and insights to ponder on and act on. Thank you guys ❤

[@billbonczek7238]

It would have been interesting if Charles Ellis had calculated the investment return if his mother had invested his college money in the S&P 90 (the stock market index in place before the S&P 500 came into existence in 1957) compared to the 0 percent return on the money placed in the bank checking account.

[@YouBillyW]

Great channel - great show

[@marcb934]

Great guy! Thx.

[@johnmerlino7011]

In the last two years, the Federal Reserve has manipulated stock and bond markets so that 'price discovery' is not real any longer. Factors that now effectively effect the stock and bond markets include: 1. Fundamentals, 2. Technicals, 3. Mechanics (Options - call/puts), 4. The Fed purchases of bonds (daily), and FX (DXY) valuation of the USD. All our education really is getting less meaningful when markets are manipulated in this manner. I don't believe we have 'free markets' any longer. Also, we probably are going into long term stagflation where GDP continues to decline. In that environment you can't just assume stock markets will go up.

[@mourad_weider]

an investment wisdom

[@merchantsailor]

A bubble in the financial services sectors, are they squeezing out the companies that do provide a service , make a product, and not just shuffle assets.

[@aman101112]

Charles Ellis is a wise sage of investing but his views do not reconcile with the actual data. The last year should be a good example of how far valuations had gotten from reality. In an efficient market this shouldn't have happened. Markets will never be efficient. But for an average investor who is not willing to do the work, the views expressed are actually correct and very relevant.

[@chetmohr8396]

The last year evaluations didn’t get that crazy…and now P/E’s are in the mid-low teens

[@chetmohr8396]

Valuations can go high in an efficient market. How does that disprove it? Also, no one can beat the market long term, even the investor who spends 24/7 researching and studying.

[@aman101112]

@@chetmohr8396 How do you justify prices of some of the SPACs based on market efficiency? Efficiency means all information is reflected in the price. What information existed last year that made SPACs 100x more valuable than they are today?

[@chetmohr8396]

@@aman101112 you’re asking what has changed since last year? Inflation, interest rates, earnings, elections, supply chain issues, the War in Ukraine - many things have happened since last year.

[@rof8200]

When the USD debases, those treasury bills are going to be surprising.

[@kpduffy]

"The market is competitive, rational and efficient." Ok, explain 2021 when everyone lost their minds. There are plenty of ways to gain edges in the highly competitive investment game. For starters, avoid crowds, simple narratives and bubbles. Next, go fishing in the anti-bubbles. E.g., in the late '90s, New Economy stocks were in a bubble, while Old Economy stocks were abandoned and dirt cheap. During the late '80s, "Japan's rise" was the conventional wisdom, with "America's decline" its mirror image. This is a simple formula... but not easy.

[@qake2021]

👏👏👏😁👍👍👍👏👏👏

[@thomasotoole3212]

For the average retail investor, this was a useless interview.. Yes, Treasures for now, and transition to equities as the Fed pivots.. Nothing new here..

[@yoshortyb]

This guy is always a broken record. I am a huge advocate for index investing, but it isn't the only game in town. Charlie never really sounds competent when he can really only speak to the failures of active managers and sounds inept whenever any other topic is brought up.

[@conduit242]

So…59 years 😂

[@Garce227]

CFA is no mean task!

[@ApplesOranges123]

Just because the data is available 'does not mean it's being used, I can guarantee this gentleman is not using information sources used by Millenials. So he is espousing giving up.

[@mossdale4591]

I may be doing this gentleman a disservice, but I have stopped listening at 6:36, upon hearing his categorical support for the efficient market theory--which is surely one of the stupidest postulates ever held to by numbers of people of high I.Q.

[@mrcmid9132]

Manipulation......lol

[@jayadsilva67]

All those flashy accolades. But has he made any money. I bet he is all talk and nothing.