US equity markets are closed on Thursday in honor of the 39th President of the United States Jimmy Carter. I will be at work researching ideas. It is a particularly good day for me to answer questions and be in touch. I am not going to do a live AMA, but instead will aggregate questions today so that I can try to answer them comprehensively Thursday. Please let me know what's on your mind. The best way to contact me is at ccdemuth@rangeleycapital.com.
My answers tend to almost always come in two flavors:
hopefully substantive if it is about something on my mind or
"I don't know."
In order to get more of the first than the second, here's what is currently on my mind:
Expert Market securities, litigation stubs, merger arb and SPAC resurgence in 2025, Japanese value and activist opportunities, Argentina equities and real estate, ECIP wind down, and especially fixated on using direct indexing for all of my beta / market exposure so that I can take tax losses for myself and pass on tax gains to my heirs, donor advised fund, or Opportunity Zone rollover. Insert here throat clearing about my not being a tax advisor, financial advisor, legal advisor, or really any kind of advisor. I don't advise. I do things. But I share with a selective audience what I do in case others want to do similar things sometime.
What are your goals for this year that I might be able to help with? This year, I'm trying to optimize my health, share actionable ideas with a broad audience, share less liquid actionable ideas with accredited investors, and introduce my investing ideas to strangers unfamiliar with my work. I want to lift 5k tons, run 2.5k miles, improve my jiu jitsu, ice climbing, and backcountry skiing, and to find, size, and manage a portfolio of the most +EV ideas I can find. Then I'll get what I deserve (or, hopefully, better than I deserve).
Speaking of Jimmy Carter, I’m thinking about inflation this week. What are my personal favorite hedges? I have two.
First, I like owning geographically unique land – property that has some sort of supply constraint (e.g. waterfront) and value to me. This lets me opt out of the price system in future decades. If the nominal price goes up (or down) by orders of magnitude, I can be indifferent. I just want to pre-buy the property that I want to be able to live on and cultivate.
Secondly: equities. Stock markets naturally do well in countries with stability and growth. But they can also do well, at least in local nominal terms, in chaos and hyperinflation. Both Zimbabwe and Venezuela equities were far better than alternatives during their hyperinflationary death spirals. I invest actively through my hedge fund and passively through direct indexing. You can do both too – hedging everything (including yourself).