How is fundamental value similar to the moon? Brian Singer, head of William Blair’s Dynamic Allocation Strategies Team, says fundamental value’s relationship to price is similar to that of the moon’s relationship to the ocean tides – fundamental is a long-term, “gravitational” force on price; and just as the moon causes tides to rise, fundamental value does the same for investments.
But fundamental analysis alone is insufficient, according to Mr. Singer. As he explains in this video, the post-Cold War era is characterized by geopolitical instability, and old rules don’t necessarily still apply. Fundamental analysis is necessary, in that you don’t want to be on “the wrong side of the tide,” but sufficiency can only come from understanding the different disciplines necessary to navigate an unstable geopolitical world.
This video is the last in a 9 part video series on macro investing from William Blair. All 9 videos can be found here: William Blair Macro Videos.