Institutional Imperative 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.”



Nothing on this website should be considered individual investment advice.