Michael Lipper: decoding the Super Bowl's hidden lessons
The morning after the showpiece event of the NFL season, the veteran investor reveals the many messages it holds for investors.
by Michael Lipper on Feb 04, 2013 at 09:37
The Super Bowl is a uniquely American Event. Outside of the US, the only equivalents that I can think of are the World Cup for football (what we in the US call soccer) and possibly the Melbourne Cup race (for thoroughbred horses) in Australia.
To place the Super Bowl’s importance in the American context, I have been told that over 170 million will watch the game this year, or about 50 million more than voted in the last Presidential election.
My long-term readers may remember that last year I blogged from Shanghai, after watching the game with a single color commentator and very few commercials. I missed the commercials, which I will discuss in a moment.
Two other points of disclosure are needed before I discuss my investment thoughts.
First, as indicated many times in the past, I search for investment implications of just about everything to which I am exposed.
The second, is that for many years I have had the privilege of working with the National Football League and the NFL Players Association on their defined contribution plans governed by their collective bargaining agreement.
Comparing football and institutional investing
Both efforts require a high level of training, energy, integrity, risk management, and the recognition that there is an end to every game, but also there is always the next season or market.
The role of analysts is to review all relevant past history to determine potential risks and rewards generated in the past.
In last week’s post I listed 19 different measures that I look for in examining different stocks and funds. The 19 measures are far from exhaustive. (The key point to the list is they are not directly imbedded in any ETFs that I know.)
Recognize that both football analysts and securities analysts are essentially historians. Putting these historical evaluations to work is the job of the quarterbacks or portfolio managers who need to update the history based on game day evaluations and the ability to see new opportunities and threats.
In the end the quarterbacks and portfolio managers must execute both the planned plays/options and the broken ones.
The coaches or chief investment officers need to provide that the right people are on the field or on the right desk, as portfolio manager, analyst, trader or administrator.
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