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What Would Tom Hodgman Do Today?

Tom Joined Dock Street in 1995—the best partner anyone could ask for

When Dock Street really came together in the mid 1990’s, the Greenwich office was filled with highly experienced investors. So on days like today I often ask myself what would Stillman Rockefeller, Jack Howell, and Jon Old be doing with their stock portfolios? Not to mention Tom Hodgman.

Or what is Warren Buffett doing today, or Peter Lynch? What ties all these people together is their inactivity on days like this.

Of course we do not know if this is the beginning of a bear market, or the climax of the recent correction (or something in between), we only know what all these smart investors would be saying if they were still with us.

We also know that the last 7 weeks have driven fear levels to heights often associated with market bottoms. The chart below shows how current levels of pessimism in the last 10 years have offered more opportunities to buy than signals to sell. Of course that wouldn’t have worked in 2008. Nothing’s perfect.

The green bars show when the Investors Intelligence Bull/Bear Ratio goes below 1.0—it looks like that will happen today. 

But given the strength of the US economy, and the powerful earnings growth exhibited by the companies we own, riding this out still appears to be the best course of action right now.

Best regards,

Daniel A. Ogden


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