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Templeton's Way with Money: Strategies and Philosophy of a Legendary Investor
The enduring legacy of a legendary investor Called the "greatest stock picker of the century" by Money magazine, legendary fund manager Sir John Templeton is remembered as one of the world's foremost investors, known for his pioneering insights and phenomenal investment performance over a professional career which spanned more than half a century.Templeton's Way with Money provides a unique, professional 21st century appraisal of what made this formidable investor the success he was--and why his methods remain as valid today as they were during his long and successful lifetime.Written by two investment experts, one of whom worked closely with Sir John for ten years, and drawing on previously unpublished documents, the book explains in detail how John Templeton's simple but effective investment philosophy of riding out the ups and downs of the market cycle continues to be as relevant as ever for professional and private investors alike.Key features fresh and detailed reappraisal, drawing on a number of previously unpublished documents, of the philosophy which Templeton applied to the two phase of his investment career--first as an investment counsel, and latterly as the most successful global fund manager of his generation A detailed and original study of the performance of the Templeton Growth Fund, demonstrating in detail how Templeton achieved the Holy Grail of investment--above average returns with below average risk First hand accounts from former colleagues of their experience in working with Templeton--including those of author Alasdair Nairn's ten-year career working with and for the investment management organization that was Templeton's life work Proprietary and original research which explains why Templeton's seemingly simple investment philosophy is sure to produce exceptional returns if implemented effectively Current market conditions make Templeton's contrarian investment method of profiting from pessimism particularly relevant today, and this book a must-read for anyone working with investments.
272 pages, Kindle Edition
First published October 1, 2004
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Displaying 1 - 12 of 12 reviews
December 28, 2014
In my quest to learn more about value investing and after having read about Buffet, Munger, Lynch, it was only natural for me to learn next about Sir John Templeton. I enjoyed the small documentary about his life created by his foundation here. I also enjoyed a speech made by his niece Lauren Templeton in an event hosted by Prem Watsa in Canada in 2012 here. I found a lot more details about his life here in this enjoyable book. My main takeaways are similar to those I found in other reads about value investing: not to underestimate the power of long term compounded interest, not to follow the herd, buy at the point of maximum pessimism. I felt that he was, just like Warren Buffet, a mix between value and growth, ie Benjamin Graham and Philipp Fisher almost 20 years before Warren Buffet. Very insightful.
October 22, 2014
This book is pretty good. The reason for the mediocre rating is that if you want to learn about Templeton, I highly suggest watching the documentary 'Contrarian' which is widely available online. As for the book, it does a good job summarizing the important points in Templeton's life and career. It also goes into detail of his investing style and provides numerous examples of his advice (in the Appendix). I don't find the advice all to practical as you will get the same benefit from watching the above documentary.
August 22, 2018
The second best short cut to financial experience after working and learning from one of the great masters is reading the books they write. This is something fairly close – a book by a person who did work for a true master. Alasdair Nairn, CEO of the asset management firm Edinburgh Partners, worked for the great sir John Templeton for ten years. Together with journalist Jonathan Davis he presents the life, career and investment process of the late sir John.
Templeton was a value investor in the true sense. He bought stocks if the stock price was lower than the estimated intrinsic value. He was indifferent to whether the margin of safety originated from low pricing compared to current fundamentals or from growth during the coming five years. Fueled by curiosity and the urge to find the best bargains he was one of the first US fund managers investing in global stocks. The insight that a more sizable selection of stocks to choose from gives you a larger chance of finding a really good bargain might sound trivial, but few US fund managers searched outside the US prior to Templeton.
The authors describe a Templeton who’s self- reliance, belief in humanity’s ability to create value, unrelenting work ethic and ability to reduce complex issues to practical rules of thumbs resulted in magnificent results. He acted on logic and numbers rather than on emotions and other investor’s opinions. However, nothing spectacular really happened before he moved to the Bahamas.
Templeton had a dual asset management career. During the first part he managed funds and in parallel built his asset management firm. After selling the firm (apart from the Templeton Growth Fund), he moved to the Bahamas and focused on managing his remaining fund. Templeton’s Growth Fund outperformed the market by 3,7 percent per year over 38 years, with all outperformance during poor stock markets. However, before “half time”, Templeton actually narrowly lagged the market. After moving to the Bahamas he outperformed by 6 percent a year. The truth is that whether proximity to markets and companies are your friend or your foe very much depends on the investment process you have. Templeton’s process benefited from being relocated to a beach in the West Indies, far away from noise, consensus opinions, administrative work and fund sales. He was once asked what made the greatest difference to the quality of his investments. He replied “Every mile I moved away from New York.”
The authors have had access to new material in the form of Templeton’s internal investment memos This means they have discovered some new sides of Templeton. Apparently he used a combination of what we today would call Shiller-PE, Tobins q and DY to estimate the risk level of the market and allocate between equity, bonds and cash. I’m the first to advocate the merits of valuation based allocation and of keeping dry powder to be able to invest in distressed situations, but I also think the authors pay this top down process too much attention in the book.
The areas where Templeton had exceptional talents was in bottom-up stock picking, so in my opinion the focus could have been shifted somewhat towards corporate analysis. As Templeton made projections five years into the future, the book could have benefitted from a deeper discussion of the difficulty of making forward predictions and how he overcame those (Templeton’s “rule five” in chapter 4 will give you a hint.) This book aims to write a handbook for those who want to invest like Templeton. At the same time this is as much a biography, which in my opinion somewhat crowds out the space available for the handbook.
Templeton was an important investor. “Invest for Maximum Real Total Return” was his simple but brilliant first rule. Why not learn how to, by reading this book?
Templeton was a value investor in the true sense. He bought stocks if the stock price was lower than the estimated intrinsic value. He was indifferent to whether the margin of safety originated from low pricing compared to current fundamentals or from growth during the coming five years. Fueled by curiosity and the urge to find the best bargains he was one of the first US fund managers investing in global stocks. The insight that a more sizable selection of stocks to choose from gives you a larger chance of finding a really good bargain might sound trivial, but few US fund managers searched outside the US prior to Templeton.
The authors describe a Templeton who’s self- reliance, belief in humanity’s ability to create value, unrelenting work ethic and ability to reduce complex issues to practical rules of thumbs resulted in magnificent results. He acted on logic and numbers rather than on emotions and other investor’s opinions. However, nothing spectacular really happened before he moved to the Bahamas.
Templeton had a dual asset management career. During the first part he managed funds and in parallel built his asset management firm. After selling the firm (apart from the Templeton Growth Fund), he moved to the Bahamas and focused on managing his remaining fund. Templeton’s Growth Fund outperformed the market by 3,7 percent per year over 38 years, with all outperformance during poor stock markets. However, before “half time”, Templeton actually narrowly lagged the market. After moving to the Bahamas he outperformed by 6 percent a year. The truth is that whether proximity to markets and companies are your friend or your foe very much depends on the investment process you have. Templeton’s process benefited from being relocated to a beach in the West Indies, far away from noise, consensus opinions, administrative work and fund sales. He was once asked what made the greatest difference to the quality of his investments. He replied “Every mile I moved away from New York.”
The authors have had access to new material in the form of Templeton’s internal investment memos This means they have discovered some new sides of Templeton. Apparently he used a combination of what we today would call Shiller-PE, Tobins q and DY to estimate the risk level of the market and allocate between equity, bonds and cash. I’m the first to advocate the merits of valuation based allocation and of keeping dry powder to be able to invest in distressed situations, but I also think the authors pay this top down process too much attention in the book.
The areas where Templeton had exceptional talents was in bottom-up stock picking, so in my opinion the focus could have been shifted somewhat towards corporate analysis. As Templeton made projections five years into the future, the book could have benefitted from a deeper discussion of the difficulty of making forward predictions and how he overcame those (Templeton’s “rule five” in chapter 4 will give you a hint.) This book aims to write a handbook for those who want to invest like Templeton. At the same time this is as much a biography, which in my opinion somewhat crowds out the space available for the handbook.
Templeton was an important investor. “Invest for Maximum Real Total Return” was his simple but brilliant first rule. Why not learn how to, by reading this book?
May 15, 2017
Not bad, but basically common sense. Value investors say "buy cheap stock", common sense and no big analyses or models needed . Maybe you would win those few additional percents a year, maybe not. I;m not interested in such things, I want to crack randomness (e.g. unpredictable "short fluctuations"). Maybe possible, maybe not, but at least it generates meaning (hard impossible problem) and probably trains brain for more complex things.
It's like my answer for what was said in this book.
It's like my answer for what was said in this book.
February 15, 2022
A brilliant investor and seeker of virtue…he brought investment innovations like the logic of risk reduction through geographic diversity and the creation of ‘cheap convexity’ in open-ended funds through the discipline of the ‘Yale Method’ while ultimately using his fortune to permanently endow a search for the intersection of the natural sciences with theology.
May 18, 2019
Astonishing Focus and Foresight of Sir John Templeton. He has thankfully shared his wisdom and experience. I heard the book on Audible while enjoying my walks. Nice narration. The book shares all the investment advise you are ever going to need in lifetime
March 1, 2025
Discount 80%, buy at 20% value
More country = More bargain
More country = More bargain
December 7, 2012
Templeton's way makes me think he was a precursor of Buffet. It will be interesting to see what links may exist between these two value investors.
The approach the authors use is to let Templeton speak for himself as much as possible rather than giving their interpretation.
Of interest to me is the reliance on 30 years of history that consistently recurs in his comments to his investors. Today we think ten years is long term. It is difficult to even find longer data sets. He then tried to project a 5 year future earnings target to establish prices for stocks.
The other approach is his use of GDP and total market data to evaluate a stock relative to the total market.
Good book, moves quickly and does a good job describing a philosophy of investing.
The approach the authors use is to let Templeton speak for himself as much as possible rather than giving their interpretation.
Of interest to me is the reliance on 30 years of history that consistently recurs in his comments to his investors. Today we think ten years is long term. It is difficult to even find longer data sets. He then tried to project a 5 year future earnings target to establish prices for stocks.
The other approach is his use of GDP and total market data to evaluate a stock relative to the total market.
Good book, moves quickly and does a good job describing a philosophy of investing.
May 29, 2013
This was my first book on John Templeton and his investment philosophies. As such, I had a thirst for the subject. No doubt....John Templeton is a legendary investor. The book, however, was just average. It discussed Templeton's key strategies in general terms, with illustrative examples gleaned from his investment records, but I was not particularly moved by the book's style. Templeton's Way with Money did not provide much in the way of new investing insights; nor did it describe the investing life of John Templeton in an engaging style. I was bored through most of the book. I suspect there is much to learn from John Templeton's investment philosophies, techniques and discipline.....I am searching for that right book.
September 18, 2014
I liked the book, but I have to say that this is the first book I've read about Templeton, so I have no reference point to compare to.
The book can be divided in Templeton's biography, investment and work philosophy, investment methods and advice, and finally the Memos, which I think are an invaluable piece.
I really liked that the authors wrote about Templeton's methods and the variables to which he gave more weight.
As a first reading choice about Templeton's life and work, it was certainly a good one.
The book can be divided in Templeton's biography, investment and work philosophy, investment methods and advice, and finally the Memos, which I think are an invaluable piece.
I really liked that the authors wrote about Templeton's methods and the variables to which he gave more weight.
As a first reading choice about Templeton's life and work, it was certainly a good one.
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July 23, 2015book on tape
March 30, 2017
Great book about one of the greatest contrarian investors.
Displaying 1 - 12 of 12 reviews