The learning curve of equity investment

Fund management, like most other professions, is a process of trial and error, wherein the ideals you bring with you from apprenticehood must be shaped and honed in order to survive the realities. Dalton's Glen Pratt looks at how learning from past mistakes can light the way in going forward...

Just over 20 years ago when in the lower sixth, I encountered the first of many surprises about the stock market. While investigating future careers in discussion with a senior stock broker (admittedly in that bastion of financial sophistication, Huddersfield), he expressed the view that a strong UK economy could in some cases be bad for the market and more generally the stock market was uncorrelated to the strength of the economy. It sounded counter-intuitive at the time, but experience has in my view proved often consistent with this advice. First of all, the stock market is a discounting...