Indexing Is Harder Than It Sounds | The Acquirer's Multiple®

In their latest episode of the VALUE: After Hours Podcast, Brewster, Taylor, and Carlisle discuss Indexing Is Harder Than It Sounds. Here’s an excerpt from the episode:

Tobias: This is the other one I wanted to ask. James L. “What does it take to reverse on indexing?”

Bill: I don’t think it will.

Tobias: I think that most people who index through their work don’t know what’s happening. Don’t know that that’s where the money’s going.

Bill: Yeah, I think that’s actually probably a pretty nice way to live. Why would you want to reverse that?

Tobias: At the end of the year, you get a note that says you’re up, or down,” you’re just like, “Whatever.” Or [crosstalk] retire.

Bill: Yeah, you just got to focus on making more money next year and doing the same thing. In over time, it’ll work.

Tobias: Yeah.

Jake: 100% true. I don’t know if that’s the psychological path that often happens there though. People get scared and they sell out. That’s how you get to a bottom, right?

Bill: Yeah. The last bottom was a long time ago though. It might be different. I don’t know.

Tobias: 2009? They’d been in 2016, 2018. 2020s.

Bill: Nah, those weren’t real.

Jake: Color me skeptical that everyone has the faith to ride out through trauma.

Tobias: I think it’s faith so much. I think it’s just inertia.

Jake: Yeah.

Tobias: It’s hard to change.

Bill: It’s also really intelligent. There is the potential that a lot of people that are indexing have actually figured something smart out and they just stick to it.

Tobias: Yeah.

Jake: 100%. It’s just harder than it sounds when it’s– [crosstalk]

Bill: Yeah. Well, nothing is easy in this thing.

Jake: I think it’s lower every single day.

Tobias: If you’re not watching it– well, I’m suffering the same thing.

Jake: [laughs]

Bill: Imagine owning cable. You’d have to be a moron.

Jake: Oh, my God, just kicked me in the nuts sack all day long.

Bill: Yeah, that’s right. I don’t know, owning individual companies is tough, sticking in index strategy’s tough. All this shit’s tough.

Jake: I was told that was just to the moon and you just enjoy your brodown.

Tobias: Yeah, a lot of that’s gone away, hasn’t it?

Bill: Yeah.

Jake: That’s gone away, huh?

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