We all know crude oil has had a huge run this year. It has come off its all-time high, but still continues to be much higher than the beginning of the year. Taking that into account, consider Barton Biggs's words from this past summer:
Biggs said he thought the price of oil should be closer to $30 to $34 a barrel. So convinced is Biggs of his investment thesis that he increased the size of his bet in July, even as prices were rising. "When the price of an investment goes against us, unless the fundamentals have changed, our inclination is to buy more," he said in the letter.
International Herald Tribune
August 21, 2004
Some feedback from a reader:
Biggs' investors trust him and his partners, maybe because they are getting out of this man what they want, decisions based upon his brand of common sense and they are willing to underwrite the losses. Maybe he'll stumble upon enough trends to make some bucks along the way and save himself. As my friend and I work on building [our trading firm], inspired in part by your work [at http://www.trendfollowing.com], the big thing we notice is that few talk about is survivorship and compounding. These two forces could end up doing the heavy lifting in growing our funds. It's great to have a viewpoint [like Biggs' fundamental view] and ideas and it's even nice to see them made manifest in the arena of the markets, but it's much more nicer to survive coming in and leave the arena in one piece voluntarily and in comfort.
Reader
