If someone offered you a bet, winner take all for $10,000 in a game of golf would you take it? What if you could substitute Tiger Woods to play for you and drastically increase your odds of winning? This is what you are doing when you clone the best investors.
Me: I’m pretty intelligent and hard working. I did very well in college and went into a competitive medical career. I’m 1/3 intellect, 2/3 hardworking and disciplined. In undergrad I could confidently say that I had an advantage over my peers. In graduate school I realized how I measured up against the elite. Hint, pretty average. There was a tier of people that blew me away despite my maximal effort. No matter how hard I tried I could not keep up with these elite individuals.
Mohnish Pabrai: Pabrai and his brother helped his father run his businesses growing up. At the age of 11, they were essentially his board of directors and gained experience of several MBA’s. They were forced to make decisions to enable the business to survive another day. In college, he considered peers in his finance class “morons’. To him, the material was elementary and couldn’t understand why they weren’t able to grasp it and he was, considering he wasn’t a finance major. He is considered an intellectual elite testing above 180 on an IQ test. This places him in the top 0.25% of the population. He graduated in the top 1% in his engineering class and started a successful business that he sold for 7 figures. His passion for investing is second to none. He once said in an interview that he spent a month drilling down on the auto industry, describing it as an “orgasmic” experience. He stayed up until 3-4am every night archiving conference calls, watching videos, and read transcripts and more than 20 books. His fellow collaborators on the investment couldn’t keep up with his torrential pace. His performance speaks for itself with a >26% compound rate. I have a mind that finds comfort in predicable and repeatable patterns. However the unpredictable nature of the economy is better suited for the adaptable and creative mind. If you were to objectively compare me with Pabrai, who you let invest your money?
Me IQ: slightly above average
Experience: 3 years
Performance: TBD
Passion: Hobby(1-2 hours/day) Background: Science(rigid, precision)
Pabrai IQ: 0.25% of the human population
Experience: 25+ years, started and sold a multimillion dollar business
Performance: >26% gross, top 1% of managers
Passion: “Orgasmic”(professional)
Background: Business ingrained during child hood
If you choose me, or yourself(for the majority of the population) then I would question your sanity and rationale. The beauty is that Pabrai isn’t the only superinvestor you can clone. There are many bright, successful investors w/ brilliant track records. Their 13Fs are available 4x a year. Don’t stop there, Clone their philosophy, their research and anything else you can get your greedy gobbly little hands on. Don’t let your ego get in the way. The Tiger Woods scenario is a no brainer, why isn’t this?
The Rational Cloner 