Time Value of Money
Kinds of Interest Rates
Future Value of an Uneven Cash flow
Probability Distribution
Standard Deviation
Security Market Line
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Stock Valuation
Cost of Capital
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Capital Budgeting
Hall of Fame
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Julian Robertson

Julian Robertson was born in 1933 in Salisbury, North Carolina. He attended the University of North Carolina and graduated in 1955 with a business administration degree. He served in the navy briefly before becoming a stockbroker with Kidder, Peabody & Co. of New York in 1957. He worked in this position for over twenty years and become one of the most successful stockbrokers at the firm. He then moved on to manage Webster Management Corporation, the Kidder Peabody money management subsidiary.

In 1980 he left this role to found his own investment/hedge fund firm called Tiger Management Group. This firm produced consistently excellent results and achieved a growth from $8 million in 1980 to $7.2 billion in 1996. At this time, Robertson was considered the world leader in hedge fund management and his stock-picking acumen was unbeatable. Large-scale investors (with a minimum investment requirement of $5 million) swarmed to be a part of the six hedge funds that he managed. The compound rate of return during the peak period is reported as being 32% and at this time Robertson was known as the “Wizard of Wall Street”.

He described the investment style of the Tiger Management Group as follows: "Our mandate is to find the 200 best companies in the world and invest in them, and find the 200 worst companies in the world and go short on them. If the 200 best don't do better than the 200 worst, you should probably be in another business."

Robertson had a very personal investment style and it is difficult for the average investor to adopt any of his strategies. Robertson took advice from the analysts working for the Tiger Management Group and used that information to make decisions. He has summarized this process by saying,Hear a [stock] story, analyze and buy aggressively if it feels right." Robertson is often described as a macro trader who simply rode the international trends. He was against the use of fundamentals and this factor may have played a role in the demise of the company. There is very little written about his investment style except that it is base on a "smart idea, grounded on exhaustive research, followed by a big bet." This approach worked well for some time, but it was followed by an abrupt end that is not uncommon when it comes to hedge funds.

Robertson agonized over whether or not to invest in tech-stock during the late 1990’s. He decided not to, believing it to be “irrational”, and as a result the Tiger Management Group missed out on big gains. Tiger experienced a gradual demise between 1998 and 2000. All funds were closed down and the assets dropped in value from $23 billion to just $6 billion. The reasons for this downfall are frequently reported to be poor stock choices and large, risky bets. Other observers often state that defections from high-level executives and Robertson’s autocratic style took its toll. A former executive is quoted as saying, "When Robertson is convinced that he is right, Julian bets the farm."

Robertson retired from managing hedge funds. He continues to have an active philanthropic role and supports environmental causes.

Publications about Julian Robertson include:

Golden Nuggets from Sir John Templeton

About the author

Mark McCracken

Author: Mark McCracken is a corporate trainer and author living in Higashi Osaka, Japan. He is the author of thousands of online articles as well as the Business English textbook, "25 Business Skills in English".

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