It's official. Charlie Munger, 97 years young, will headline this year's Sohn Hearts & Minds investor conference.
Landing the American billionaire investor, vice-chairman of Berkshire Hathaway and alter ego to Warren Buffett is a coup for the two co-executive chairs at Barrenjoey, Matthew Grounds and Guy Fowler, and veteran fund manager and philanthropist Chris Cuffe. Each one of them is a big player in Australian capital markets and investment. “We finally got our man. I don't think he does these sorts of things anywhere,” Fowler said.
“We'd start off every year saying ‘who could we possibly dream of having at the conference?' We've had Ray Dalio, we've had Howard Marks, Scott Galloway, all brilliant, but every year we sit there and say ‘is there a chance, is there any way we could possibly get someone from Omaha?' ”
The star pick is thanks to Caledonia's Mark Nelson, a long-time supporter of Hearts & Minds who has made many a pilgrimage to the legendary “Woodstock for capitalists” annual meeting of Berkshire Hathaway attended by 40,000 shareholders. Nelson has known Munger for 25 years.
“We've been asking Mark to see if he could do this for five years” Grounds said. “Mark just wanted to prequalify, make sure the right crowds were there, that we had the Opera House,” he joked.
Cuffe added: “I only just found out that Charlie and Mark Nelson are part of a regular breakfast session that a few very-high profile people, much higher than all of us, have regularly.”
Lockdowns have forced a second virtual Hearts & Minds conference this year, which Fowler said was serendipitous because the Opera House seated only 600.
Munger's interview will be an exclusive appointment viewing for attendees, with no replay.
Hearts & Minds, now in its fifth year, is billed as the thinking investor's conference.
It is an idea unashamedly pinched from the philanthropic US Sohn Conference by Grounds, Fowler and businessman Gary Weiss in 2016. The conference is now a partner and raises millions of dollars annually for medical research. It combines keynotes from some of the biggest names in international and Australian investment alongside a string of often fresh talent who each have just 10 minutes to deliver a TEDxstyle pitch on one stock. Many pay to speak and share their IP.
“Probably a third of the list I will never have heard of and I think gee I've hung around this industry forever. The world is a big place for investment management,” Cuffe said.
The conference itself makes about $2m a year, but what is different from Sohn in the US is the listed investment company HM1 created from the conference that now spits out $15m a year for charity.
“Guy had an idea to set up a private fund, which we did when we were at UBS,” Grounds said. “We just did a small fund of $30m$40m wrapped around the stock picks for a year that went really well.”
So well that Grounds and Fowler decided to look at a $100m LIC and approached their old mate Cuffe to chair it.
“Chris said love it, except I won't do it unless it's half a billion dollars. True story,” Grounds said laughing. Sixty-five per cent of the funds under management would come from six core fund managers who would each pick three stocks. Thirty-five per cent would come from the most popular 10minute pitches of the conference.
Fowler took a roadshow to fund managers pitching the idea and came back with a thumbs-up on the high-conviction investment. “There had been some academic work done around a collection of fund managers with their top stock picks doing really well. The proof has been in the pudding at HM1,” he said.
Three years in, HM1 is now about $1bn in size and owns the rights to the conference. Its return to September this year was down a little at 15 per cent but over the past three years Cuffe said it had returned 25 per cent against a benchmark 15 per cent, comfortably beating the index. “Unlike most other LICs in the past couple of years, HM1 has continued to trade at around NTA or a slight premium and on good volumes, so people like it,” Cuffe said.
The fundies waive their fees and HM1 powers donations for medical research with 1.5 per cent of NTA, now $15m a year going to medical research.
So has anyone been to Omaha, Nebraska? “Haven't been to Omaha,” Fowler said.
“Never,” said Cuffe. “It's on the list. I'd better go before the lads get too much older - or before I get too much older.”
All three have no doubt that Munger will captivate investors. If last year's pandemic upended markets, the recovery presents a different challenge for fund managers and stock pickers.
“It's important to sit down and understand the philosophies again from someone who has seen it all,” Fowler said. “He's proven to be one of the greatest and best of all time. He hasn't invested in fads, he's invested where he understands. He calls it the circle of competence.”
Fowler said together Munger and Buffett had stuck to the same formula for 50 years. “They hate cryptocurrencies, think they are an absolute scam. They don't trade, they back a good company and good management team and are happy to be invested there for 30-40 years.” He pointed to Coca-Cola and more recently Apple.
“I've been investing for 30 years or more, but right now there is more of a confluence of issues than I have ever felt, particularly with interest rates so low,” Cuffe said. “I don't see the conference as having a particular theme but certain of the speakers Charlie Munger will listen with interest on what he thinks about investment bargains of the world.”
In Cuffe's experience across Colonial First State, Challenger and UniSuper, long-term investing is a rare skill: “In the last 20 years nearly everybody has this business risk thing at the back of their mind. If they are different from the pack for more than 12 months, they get worried. Good investors are not worried about a time frame like that and that's what sets them apart, they are the super long-term investors.”
Returning to the conference are two stellar stock pickers from last year: Cota Capital's Babak Poushanchi, whose pick Bill.com delivered 179 per cent returns for HM1 investors, and Tekne Capital, whose pick Yeahka clocked up 112 per cent returns.
New speakers announced so far include Eleanor Swanson from Firetrail Investments, Yen Liow from Aravt Global and Jay Kahn from Flight Deck.
When it began, Sohn Hearts & Minds was associated with UBS where both Grounds and Fowler worked. When both left in 2019, later moving to set up rival investment bank Barrenjoey, the conference went with them.
Hearts & Minds has managed to keep the UBS sponsorship. So no hard feelings then?
Both men laugh. “Of course they would be a major sponsor,” Grounds said. “Goldmans like it. There are plenty of people there who love the conference, it's universal across the market.”
The 2021 Sohn Hearts & Minds Conference will be held on December 3. Tickets and details at sohnheartsandminds.com.au
This article was originally posted by The Australian here.
Licensed by Copyright Agency. You must not copy this work without permission.
Regal Funds Management co founder, Phil King is recommending that investors sell shares in travel company Flight Centre, arguing that the stock has rebounded too strongly since its lows of last year with the company still facing headwinds with the shift to online travel bookings.
Builders Union’s Markus Bihler has picked the freshly listed London-based fintech Wise as his top pick at the 2021 Sohn Hearts & Minds Conference.
Joyce Meng of Fact Capital says investors should take advantage of growing skincare spends.
Charlie Munger, the 97-year-old investor and polymath who has been the trusted sidekick of Warren Buffett for decades shared his thoughts on markets, investing and geopolitics in a wide-ranging interview broadcast as part of the Sohn Hearts & Minds Investment Conference.
Atreides Management’s Gavin Baker has picked cryptocurrency exchange Coinbase Global at the Sohn conference, believing in its growth opportunities as more people embrace the crypto world.
Pinnacle Investment Management is a multi-boutique fund manager that owns stakes in 16 Australian fund managers across Australia of between 23 to 49 per cent. It is led by CEO Ian Macoun who is said to be famous for picking star portfolio managers.
There is no bigger or unsolved problem than taxes which remains consuming, complicated and error prone. Businesses still manage their taxes with a combination of pen and paper and excel and the complexities are only increasing. Babak Poushanchi says Avalara, based in Seattle, is solving the problem.
Peter Cooper, the founder of Cooper Investors, HM1 Core Fund Manager, shares his learnings from Charlie Munger.
Jay Kahn’s Flight Deck fund seeks out stocks in “roads least travelled”, and Kahn reckons it has unearthed a “multi-bagger”: Bengo4, which he describes as Japan’s DocuSign.
Regal Funds Management has upended its short selling approach to combat the pressures of a rising bull market, focusing instead on share price blips that have included so-called meme stock GameStop, according to chief investment officer Phil King.
Regal Funds Management’s Phil King says it’s a tough market for short sellers but it didn’t stop him from nominating a prominent one at Sohn Hearts and Minds today: FlightCentre.
It’s an “age of instant gratification”, according to Tekne Capital Management’s Beeneet Kothari, and he is picking restaurant delivery group Delivery Hero to ride the innovation in last-mile logistics in the $US1 trillion takeaway food sector.
Berkshire Hathaway’s veteran 97-year-old investor Charlie Mungert warns that he views today’s markets as wildly overvalued in places.
Berkshire Hathaway vice chairman Charlie Munger, a longtime partner of Warren Buffett, has made his first appearance at the sixth annual Sohn conference in Australia on Friday.
Firetrail’s Eleanor Swanson believes Megaport is currently one of the best stories on the sharemarket, and has the potential to join the ranks of Australian-founded technology companies such as Atlassian and Afterpay.
Munro Partners’ Nick Griffin has pitched Nasdaq-listed Onsemi as his stock pick at this year’s Sohn Hearts & Minds conference, labelling it the ‘hidden hero’ of the path to decarbonisation.
Eley Griffiths small-cap portfolio manager David Allingham has picked Ian Macoun’s multi-boutique funds management group Pinnacle Investment Management as his top stock pick for the Sohn Conference 2021.
Regal’s Phil King says he’s the only Australian hedge fund manager brave enough or silly enough to return to Sohn Hearts & Minds to pitch a short stock during one of the biggest bull markets of all time.
Fresh from picking last year’s 180 per cent gainer Nasdaq-listed Bill.com and other big winners such as DocuSign three years ago, Babak Poushanchi is back at Sohn in 2021 with another stock pick. This year the Cota Capital founder and tech-focused investor has named Seattle-based tax software business Avalara as his top pick.
An experienced investor with a track record of short selling, King will be the only fund manager on the day tipping a short stock at the annual Australian Sohn Conference on Friday.
Yen Liow, managing partner of Aravt Global has pitched Gitlab, a founder-led software business that is focused on DevOps at the Sohn Hearts & Minds Conference. Liow stumbled upon the company while researching Atlassian, which itself generated 20 times the return on capital since its IPO.
Firetrail Investments’ Eleanor Swanson has tipped ASX listed telco software company, Megaport, as the best stock for 2022 at the annual Sohn Hearts & Minds Conference.
Moderna co-founder Robert Langer has said he’s confident the company’s vaccine will be effective against the omicron strain of COVID-19, but not as effective as it is against the original variant. “But that doesn’t mean it won’t be effective,” said Mr Langer.
Spotify’s market-leading position in the future of audio will catapult the business to among the so-called FAANG stocks alongside the likes of Apple and Amazon, powering revenue growth and its share price, according to Hamish Corlett, co-founder of TDM Growth Partners.
Hamish Corlett is the only stock picker in the history of the Sohn Hearts & Minds Investment Conference to pitch exactly the same company twice.
From e-signatures to last-mile logistics and facials, the annual conference showed that waves of disruption continue to break in different ways across different sectors
Fund manager, Qiao Ma has tipped Hong Kong based global power tools and outdoor equipment company Techtronic Industries at the Sohn Hearts & Minds conference on Friday.
Moderna co-founder Robert Langer has suggested the vaccine maker will know within days if its mRNA Covid-19 vaccine is effective against the new variant, Omicron, as he predicted future mutations and the likelihood of the virus becoming “something life flu” that will require regular vaccine boosters.
Griffin expects the car market will be 50 per cent electric by 2030. He likes Onsemi in particular because of its management, and the fact it is being priced as an industrial semiconductor producer.
Beeneet Kothari of Tekne Capital Management has chosen Delivery Hero as his stock pick at the Sohn Hearts & Minds conference, saying it is the best way to play the innovation and last-mile logistics trend.
Cooper Investors’ Qiao Ma says that despite cordless power tools provider Techtronic Industries being an industrials company, it’s really a technology company at heart.
FACT Capitals' Joyce Meng pitched Beauty Health Company at the sixth annual Sohn Hearts and Minds Conference. Meng is forecasting 30 per cent durable and organic growth driven by accelerating equipment placements and a price target of $40 a share for 40 per cent upside.
Moderna’s co-founder expects the biotech’s vaccine will be at least somewhat effective against the Omicron variant, but says his company can quickly pump out variant-specific boosters for new strains when needed.
Jay Kahn of Flight Deck Capital has pitched Nikkei-listed Bengo4 as his stock pick for this year’s Sohn Hearts & Minds conference, following the recent acceptance of the electronic signature in Japan due to the Covid-19 pandemic.
Moderna will know in just over a week how effective its COVID-19 vaccine is against the omicron strain, according to the company’s co-founder Robert Langer, who presented at the sixth annnual Sohn Hearts and Minds Conference.
Gavin Baker, managing partner and CIO of Atreides Management, a $4.5bn crossover firm based in Massachusetts, recommends investors hold Coinbase, a platform for investing in cryptocurrency.
Yen Liow, founder and portfolio manager of Aravt Global, has a bullish take on Nasdaq-listed software development company GitLab, which he expects to soar in the coming years.
Investment legend Charlie Munger says the current climate on global markets is crazier than the dot-com bubble two decades ago, as he savaged the boom in cryptocurrencies as insane and backed China’s ban on the digital assets.
Builders Unions', Markus Bihler pitched Wise at the sixth annual Sohn Hearts & Minds Conference. Over the next five years, the fund manager expects the target share price to hit 30 pounds by 2027, a 27 per cent five year annualised return.
For all that heavyweight finance names Michael Walsh, David Paradice, Matthew Grounds and Gary Weiss have in common professionally, one thing they can’t seem to find consensus on is music.
Fund Manager Mark Nelson of Caledonia to interview Berkshire Hathaway's Charlie Munger at the sixth annual Sohn Hearts and Minds Conference.
Eleanor Swanson of Firetrail Investments sat down with Equity Mates Media ahead of this year's conference. Eleanor shares the story of her first investment, breaks down the small cap landscape and shares some of the best companies that she's come across during her time in the markets.
Babak Poushanchi, one of the legends of the Sohn Hearts & Minds conference, has opened up about his approach to riding the disruptive technology boom.
Conference Manager Joyce Meng's FACT Capital is proof that the existing Wall Street model could be wildly improved upon.
Cota Capital’s Babak Poushanchi emerged the top picker from the 2020 Sohn Hearts & Minds Conference, with his pick, bill.com, share price up more than 200 per cent.
Yen Liow of Aravt Global sat down with Equity Mates Media ahead of this year's conference. Yen shares the story of his first investment, Aravt's investment philosophy, his thoughts on the future of the payments industry and why he's excited to be a part of the Hearts & Minds family.
Returning Conference Manager Beeneet Kothari talks 'quick commerce', a topic at the heart of his stock pick for the 2021 Sohn Hearts & Minds Conference.
Hearts and Minds Investments Limited (ASX:HM1)'s Chief Investment Officer Rory Lucas and founding Hearts & Minds supporter Phil King of Regal Funds Management recently spoke with the hosts of You're In Good Company, an Equity Mates Media podcast.
Returning Conference Manager Nick Griffin of Munro Partners attempts to capitalise on the climate change thematic that it has declared as the biggest investment opportunity since the internet.
New Conference Manager Eleanor Swanson was instrumental in convincing the investment team at Firetrail Investments to buy into AfterPay.
As a rising star within Firetrail Investment Management, Eleanor Swanson was instrumental in getting the firm to back Afterpay when it was trading at just $20, winning over the senior investment managers.
Eley Griffiths Group portfolio manager David Allingham says the Sohn Hearts and Minds Conference is the Australian investment management industry’s answer to the Woodstock Festival.
Returning Conference Manager Qiao Ma is planning to tip a Hong Kong-based consumer brand player when she fronts the annual Sohn Hearts & Minds conference next month.
Returning Conference Manager Beeneet Kothari sat down with Equity Mates to discuss his first investment, views on China and Cryptocurrency, and why he loves being involved in the Sohn Hearts & Minds Conference.
The payments sector has entered a golden era, says Avart Global’s Yen Liow, who hails from Melbourne.
Professor Robert Langer, the billionaire co-founder of vaccine maker Moderna says that early investors in the biotech startup should share the credit for the development of the company’s coronavirus vaccine.
The powerful technology that has enabled mRNA vaccines to save millions of lives during the coronavirus pandemic has much broader potential, according Bob Langer, one of the co-founders of Moderna.
Moderna co-founder Robert Langer says vaccine development for a range of diseases – not just Covid-19 – will be one of the biggest trends among biotechnology in coming years.
Beeneet Kothari admits it’s been a ‘bloodbath’ for Chinese tech stocks this year, but there are two good reasons he thinks the sentiment will shift.
Legendary investor Charlie Munger to headline Sohn Hearts & Minds 2021 conference.
Charlie Munger, who will headline this year’s Sohn Hearts & Minds Conference, places one quality above all else: patience.
Charlie Munger, American billionaire investor and vice-chairman of Berkshire Hathaway to headline Sohn Hearts & Minds 2021 Conference.
Warren Buffett’s right-hand man Charlie Munger is the headline act at Sohn Hearts and Minds this year and the 97-year-old investment legend is expected to offer forthright views on global financial markets which are now at a critical juncture.