Institutional Imperative is the newsletter/blog of the asset management firm, Hamilton Research and Management, LLC. It is a value-oriented financial markets journal for enterprising investors, whether they are sophisticated individuals, financial advisors, family offices, hedge funds, pension funds, non-profit foundations or other institutions. We aim to publish 10 times per year initially. We also post more frequent and shorter notes on our blog.
Most institutions try to add only incremental value over some index, and never underperform the index significantly, even over a short period of time, by having their portfolios look very much like that index or like a contrived peer group of investors. Suffering from the “institutional imperative,” pension funds, endowments, and family offices wind up mimicking each other in their bland diversification. As Keynes said, it’s better to “fail conventionally than succeed unconventionally.” Institutions also construct portfolios in accord with modern portfolio theory and prearranged static asset allocations without thinking about fundamental asset class valuation.
By contrast, we serve readers who aren’t benchmark-conscious in portfolio construction, are agnostic in terms of where in a firm’s capital structure (stocks or bonds) they may find cheap securities, and don’t adhere to prearranged asset allocations. We aim to serve subscribers whom Benjamin Graham called “enterprising investors” instead of those he called “defensive investors.” That’s not to say our primary goals aren’t downside protection and investing with a margin of safety – they are. In fact, our enterprising posture is in the service of avoiding expensive securities and protecting the downside. If you take care of the downside, we think the upside tends to take care of itself.
Frankly, we are interested in readers who are simply not inclined to prize job security over exceptional long-term investment performance, or who are lucky enough to be in a situation where their job doesn’t demand that they compete in what Seth Klarman has called ”[the short-term] relative performance derby.”
Institutional Imperative’s Editor
John Coumarianos is the Owner/Managing Member of Hamilton Research and Management, LLC. He has been the Director of Research and Investments at a $400 million family office in Southern California. He was also a Senior Mutual Fund and Equity Analyst at Morningstar for nearly six years. Prior to that, he worked as a Representative at Fidelity Investments. Mr. Coumarianos has appeared on CNBC, Bloomberg TV, and Fox Business News.
Mr. Coumarianos graduated from Columbia University, earned a master’s degree in political science at the University of Virginia, and completed coursework toward a PhD in political science at Boston College.