We Study Billionaires - The Investor’s Podcast Network

TIP526: Quality Investing: Lessons from Terry Smith


Listen Later

On today’s episode, Clay Finck discusses the investment philosophies and framework of Terry Smith, who is the founder and CEO of Fundsmith and also known as the Warren Buffett of Great Britain. 

Smith started Fundsmith in 2010, and ever since has returned 478% to his investors versus his benchmark returning 256%. He did this using the simple framework of buying good companies, not overpaying, and holding them for the long-term.


IN THIS EPISODE YOU’LL LEARN:

00:00 - Intro

02:12 - Why Terry Smith only seeks to own high-quality companies.

04:52 - How investors can go about determining the quality of a business.

08:01 - How Terry Smith compares the valuation of his portfolio against that of the S&P 500.

15:15 - Why investors must be cognizant of stock-based compensation when valuing a company.

29:28 - Why macroeconomic views and opinions are irrelevant for investors in quality businesses.

46:39 Why stocks are the best long-term investment relative to other asset classes.

53:51 - What Terry Smith’s top US equity holdings are today.

Disclaimer: Slight discrepancies in the timestamps may occur due to podcast platform differences.


BOOKS AND RESOURCES

  • Join the exclusive TIP Mastermind Community to engage in meaningful stock investing discussions with Stig, Clay, and the other community members.
  • Terry Smith’s Shareholder Letters.
  • Rebecca’s Article on Mean Reversion.
  • Don’t miss our review of Four Wide Moat Stocks for 2023.
  • Check out our takeaways from Warren Buffett's Shareholder Letters.
  • Follow Clay on Twitter.

  • NEW TO THE SHOW?

    • Check out our We Study Billionaires Starter Packs.
    • Browse through all our episodes (complete with transcripts) here.
    • Try our tool for picking stock winners and managing our portfolios: TIP Finance Tool.
    • Enjoy exclusive perks from our favorite Apps and Services.
    • Stay up-to-date on financial markets and investing strategies through our daily newsletter, We Study Markets.
    • Learn how to better start, manage, and grow your business with the best business podcasts

    • SPONSORS

      Support our free podcast by supporting our sponsors:

      • River
      • Toyota
      • Sun Life
      • The Bitcoin Way
      • Range Rover
      • Sound Advisory
      • BAM Capital
      • Fidelity
      • SimpleMining
      • Briggs & Riley
      • Public
      • Shopify

      • HELP US OUT!

        Help us reach new listeners by leaving us a rating and review on Apple Podcasts! It takes less than 30 seconds, and really helps our show grow, which allows us to bring on even better guests for you all! Thank you – we really appreciate it!

        Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

        Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

        Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

        Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

        Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

        Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

        Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

        Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

        Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

        Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

        Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

        Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

        Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

        Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

        Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

        Learn more about your ad choices. Visit megaphone.fm/adchoices

        Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

        ...more
        View all episodesView all episodes
        Download on the App Store

        We Study Billionaires - The Investor’s Podcast NetworkBy The Investor's Podcast Network

        • 4.6
        • 4.6
        • 4.6
        • 4.6
        • 4.6

        4.6

        3,214 ratings


        More shows like We Study Billionaires - The Investor’s Podcast Network

        View all
        The Meb Faber Show - Better Investing by The Idea Farm

        The Meb Faber Show - Better Investing

        930 Listeners

        Invest Like the Best with Patrick O'Shaughnessy by Colossus | Investing & Business Podcasts

        Invest Like the Best with Patrick O'Shaughnessy

        2,289 Listeners

        Capital Allocators – Inside the Institutional Investment Industry by Ted Seides – Allocator and Asset Management Expert

        Capital Allocators – Inside the Institutional Investment Industry

        805 Listeners

        TFTC: A Bitcoin Podcast by Marty Bent

        TFTC: A Bitcoin Podcast

        754 Listeners

        The Peter McCormack Show by Peter McCormack

        The Peter McCormack Show

        2,165 Listeners

        Focused Compounding by Andrew Kuhn and Geoff Gannon

        Focused Compounding

        274 Listeners

        The Bitcoin Standard Podcast by Dr. Saifedean Ammous

        The Bitcoin Standard Podcast

        426 Listeners

        Stephan Livera Podcast by Stephan Livera

        Stephan Livera Podcast

        414 Listeners

        The Pomp Podcast by Anthony Pompliano

        The Pomp Podcast

        1,834 Listeners

        The Acquirers Podcast by Tobias Carlisle

        The Acquirers Podcast

        300 Listeners

        The Intrinsic Value Podcast - The Investor’s Podcast Network by The Investor's Podcast Network

        The Intrinsic Value Podcast - The Investor’s Podcast Network

        555 Listeners

        What Bitcoin Did by Danny Knowles

        What Bitcoin Did

        227 Listeners

        Swan Signal Live - A Bitcoin Show by Swan Bitcoin

        Swan Signal Live - A Bitcoin Show

        182 Listeners

        The Memo by Howard Marks by Oaktree Capital Management

        The Memo by Howard Marks

        407 Listeners

        Coin Stories by Natalie Brunell

        Coin Stories

        401 Listeners