THIS Investing Strategy Beat Warren Buffett by 11.9%

Stick around and we’ll cover the stock market this week with all the stocks I’m watching, the stock market news and trends you need to see.

My Investing Recommendations 📈

I normally cover some kind of market moving trend or theme in these weekly topics but an article in the Wall Street Journal last week blew my mind and opened up an investing strategy you need to hear about. The story revolved around Barry Diller’s company, IAC Interactive, and its ‘catch-and-release’ strategy of buying assets, developing them and then spinning them off into their own companies. Along with the rest of the internet- and growth-stocks, shares of IAC are down 71% since February 2021 but it’s hard to argue with the returns the company has been able to produce.

But it wasn’t the amazing returns of IAC that caught my eye, it was another study shared in the article that uncovered an investing strategy you need to consider. A 22-year study beginning January 2000 by The Edge Consulting group found that spinoffs as an asset class generated three- to four-times the market returns on average over the first 12 months. Given the S&P 500 returned an annualized 7.5% over the 22-year period, that would put the strategy of investing in spinoffs for the first year as a separate company at a 22.5% annual return. For reference, Buffett’s Berkshire Hathaway returned 10.6% annualized over the 22-year period.

0:00 A Strategy to Beat Warren Buffett Stocks
2:05 How to Invest in Spinoff Stocks
14:19 Stocks to Watch this Week
20:26 Stock Market this Week

Joseph Hogue, CFA spent nearly a decade as an investment analyst for institutional firms and banks. He now helps people understand their financial lives through debt payoff strategies, investing and ways to save more money. He has appeared on Bloomberg and on sites like CNBC and Morningstar. He holds the Chartered Financial Analyst (CFA) designation and is a veteran of the Marine Corps.

[IghtImmaLogOut]

I know you usually talk about one or two particular long term market trends per vid, but is there any way you could do a video on where to specifically read up on long terms trends to watch??

[Howdy]

Hi what are your thoughts on BDC NEWT being given permission to run as a bank? Will this affect the ongoing dividend?

[theesposito]

What platform do you recommend for your European followers?

[bigmax]

What books do you recommend to start trading?

[arigutman]

Great video, Joseph, thank you for sharing... The question is beating Buffett once is great, but what about over a 20 year period? 30? 50? I think Buffett's strategy is so simply and that is what makes it ideal for any and all investors!

[justinshearer]

Warner Bros is down 58% this year how is that good?

[cherylboyer]

So you are recommending we glom onto corporate raiders activity?

[thomasd]

"We (Warren & Charlie) think diversification is, as practiced, generally makes very little sense, for anyone that knows what they're doing.
Diversification is a protection against ignorance." Quote by Warren Buffett

Concentration BUILDS wealth, diversification protects it. Quote by unknown author

[JjJj-jusg]

Thank you for your help, need any help to stop feeling that I'm going in circles and seeing my portfolio just going down.

[Gio-ceob]

If I invest in a parent company, would I normally get a share in the new companies? I’m curious if it’s a normal thing or unusual. I’m still fairly new to investing so I wanted to check. Thanks

[scott]

I created a modest buy and hold stock portfolio of established large caps that pay divs greater than 3%, in sensitive, defensive and cyclical sectors and compare results to the various markets-so far I am beating all markets

[scott]

ABBV is a good example of a successful spin-off

[jjsheets]

So you’re saying WBD is a hot buy then 🚀🚀🌝

[andrewinvests]

Best Buy did this to themselves with shady business practices and poor to non-existent customer service.

[ElCidPhysics]

so where to look for companies spinning off

[cryvn]

Nah, most of these shares are severely overpriced. The market is still delusional about the recession and needs to be hit hard.
Enter 2023 😉