Legendary value investor Rich Pzena on his 30-year career and the opportunity today | S07 E15
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This meeting is being live streamed. That means it's value after hours. I'm Tobias Carlisle, joined as always by my host, Jake Taylor. Our very special guest today is investment legend, Rich Pizzina. How are you, Rich? Good to see you.
Great. Great to be here. Thanks for having me. Welcome,
Rich. We're we're very happy to have you along. You, graduated from Wharton in 1979, and then you, cowrote a paper with Joel Greenblatt that was published in the Journal of Investment Management called How the Small Investor Can Beat the Market. What was the, reason for doing that research, and and what did you find? Do you remember?
Yeah. You know, we were all schooled in you know, we went to Wharton at the at the height of the efficient market hypothesis where the professors were trying to teach you that you can't win in the market because everybody has the same information that you do. And we'd also read the Graham and Dodd original security analysis book, which said that if you do basic stuff, you can win. So we just decided to replicate the work of Graham and Dodd, and it was in a period their their work was they they used the term net net working capital. So that wasn't was working capital net of all liabilities. If
Charting it all out.
We had our sample was companies that began with the letter a or b. Because to go through it for for all the companies was just gonna be take take our our whole lives. And we basically found that everything that that was was in that original book was worked still beautifully, and published that. Joel Joel was the was the real enterprising guy who wanted to, I was the one with the ruler on the stock guides. He was the one with the brains and the, and the, the The energy to go and get it published And
how did you get your start in the industry after you graduated?
It's funny because when I at I took a course at Wharton called security analysis, it was the worst course that I had in my college career. And it made me totally uninterested in being a professional investment person, that on top of all the efficient market hypothesis. And and I remember really vividly one of my colleagues' friends at at in school getting a job at this company called Fidelity, which nobody had ever heard of at the time. And he was gonna be an analyst. And I said, why would you wanna do that? And of course, he ran one of the big funds and retired at age 35. Mhmm. But I went to
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