tag:blogger.com,1999:blog-7280612.post116354261850625865..comments2009-12-12T00:53:30.859-05:00Byrne Hobarthttp://www.blogger.com/profile/03533607993880207323noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-7280612.post-1163900345181801322006-11-18T20:39:00.000-05:002006-11-18T20:39:00.000-05:00Growth plays today are value plays tomorrow, but they'll only get that far if they have a sustainable competitive edge or a serious lucky streak. The big problem is that WisdomTree has a <I>negative</I> edge -- they've had to pay cash for names that give them a reputation, when someone like Fidelity or Vanguard can count on the fact that they're Fidelity (or Vanguard).<BR/><BR/>WisdomTree has upside, but if it's a good market, another fund family will move in, and if another group moves in, WSDT will be crushed.Byrne Hobarthttp://www.blogger.com/profile/03533607993880207323noreply@blogger.comtag:blogger.com,1999:blog-7280612.post-1163729546046079402006-11-16T21:12:00.000-05:002006-11-16T21:12:00.000-05:00I dunno. WSDT is a growth investment, plain and simple. A growth investment with a countercyclical bend to it-- will the "catalyst" for this company come at a time when the market is doing well and even if funds (mutual or their hedged brethren) underperform, they are still > 0% on an absolute basis? No! The catalyst is when the shit hits the fan, all the portable alpha guys are shown for what they really are, and people stop paying for cheap beta. And that will happen upon the next serious market drop.<BR/><BR/>I personally am a hardcore deep value investor. Does that mean I think WSDT is a bad investment? Personally I don't think so. I can see the upside, I can see they are compensating themselves like a hedge fund which is in alignment with the interests of the equityholders more or less... I simply am not a growth investor. The question at this point is not "will they continue to grow rapidly". The question is also not "will they have any liquidity issues funding their growth". To me the question is "where will they be when they start slowing down". I know where they could be, and perhaps someone very informed could slap a probability distribution on it, but not me. <BR/><BR/>To each their own in my opinion.Dan McCarthyhttp://www.blogger.com/profile/00433276869044177062noreply@blogger.com