This week on our Masters in Business podcast, we speak with Louis G. Navellier, Chairman and Founder of Navellier & Associates, managing $2.5 billion in assets.
He began researching stocks in college, working on a project to create a cheaper alternative to the S&P500. The goal was to find a subset of about 300 holdings from the index that would match the performance of the broader index, but due to its smaller size, would be less expensive to maintain.
There was one small problem with the project: They were accidentally outperforming the S&P500. The tracking error killed the idea of launching an index alternative — but it also launched Navellier’s career as a newsletter writer and eventually running an asset management firm.
Navellier observed that the “End of Decimalization” has been the single most significant change to portfolio managers, creating all manner of unsystematic risk in executing trades.
(Read Navallier’s take on Falcon funds here)
Next week we speak with Jack Schwager, author of the seminal Market Wizards books.