In this episode of Excess Returns, Matt Zeigler sits down with investor and author Bogumil Baranowski to discuss one of investing’s most important mindset shifts: moving beyond cheap stocks to paying up for quality and exceptional opportunities. Drawing on lessons from Warren Buffett, Ben Graham, and his own journey, Bogumil explains how value investing evolves across three key phases—buying cheap, buying good, and learning to pay up. The conversation explores patience, conviction, dead money periods, family wealth stewardship, and how to think about value versus price in a noisy world.

Topics covered:
• The “cheapest dentist” analogy and why investors chase bargains
• The three phases of investor evolution: cheap, good, and exceptional
• Lessons from Buffett, Munger, and Graham on paying up for quality
• How to hold through drawdowns and dead money periods
• Why patience and conviction are the hardest investing skills
• Frugality, compounding, and lessons from his grandmother
• How long-term family investors think about wealth and stewardship
• The difference between price and value in modern markets
• How to know when cheap is too cheap and quality is worth paying for
• Why great investments are often simple to explain
• The story behind his Wall Street Journal essay “The Expensive Truth About Cheap Investments”

Timestamps:
00:00 Introduction – The cheapest dentist analogy
03:00 Why investors love cheap stocks
07:00 The evolution from bargain hunter to quality investor
09:00 Examples from Ben Graham, Buffett, and Facebook
15:30 Conviction, drawdowns, and dead money
19:00 Judging success by business progress, not stock price
27:00 Lessons from grandma on value and frugality
31:00 How Buffett evolved from cheap to quality
45:00 Investing for future generations
49:00 Invisible wealth and stewardship
52:00 The value investor dilemma
58:00 Equal-weight vs market-cap indexes
59:00 Lessons for the average investor
1:02:00 How much research you really need
1:04:30 How his WSJ essay came to life and final takeaways