During his recent Annual Shareholder meeting, Terry Smith explained why you should invest in businesses that can be run by an idiot! Here’s an excerpt from the meeting:
Smith; One of the things that we’ve tried to operate on as a mantra over the years which we didn’t invent because we didn’t actually invent anything.
We try to copy people who are quite clever, that’s the way forward, is always invest in a business that can be run by an idiot because sooner or later they all are, right.
And the fact of the matter is it’s an awful lot better to invest in certain businesses that are run by idiots than others.
And so things like consumer products companies, whilst it’s not ideal to have an idiot in charge, you’re probably going to survive, right.
But when you get into certain areas like technology it’s a lot less easy to survive, it’s not impossible, it’s just less easy.
You can watch the entire discussion here:
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