Market Analysis

3M shares down 13% yesterday illustrates the importance of “controversy” in stock selection

Raphael Fiorentino
Raphael Fiorentino
26th April 2019 - 3 min read

Like the power output of a petrol engine (a direct consequence of how fast it rotates and how much twisting force it produces, hence power = revolutions per minute x torque), the power output of a stock-picking engine (aka outperformance) is a direct consequence of how fundamentally attractive the selected stocks are and how much controversy is associated to them (hence expected outperformance = fundamentals x controversy)

Of elephants and mice - the untold story behind the rise of index trackers and the demise of active funds

Raphael Fiorentino
Raphael Fiorentino
9th April 2019 - 5 min read

The success of index trackers over the past few years has been nothing short of stupendous. They charge incredibly low fees and hardly any active fund manager has come close to beating them. Many retail investors have found religion in “going passive” and even wonder how actively managed funds can still exist. And if it is that hard for smart full-time professionals to beat a stupid passive fund, what does it say about your chances of being a half-decent steward of your self-invested pension money?

Turns out your chances rise with every passing day, whether to pick the right fund manager or the right stocks to invest in.

Commercial Launch

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Butterwire News
15th March 2019 - 1 min read

Butterwire has launched its commercial offering today.

Kraft-Heinz: Ketchup With Butterwire

Raphael Fiorentino
Raphael Fiorentino
23rd February 2019 - 2 min read

Shock and Awe in the seemingly “safe, boring and high-yielding” world of Western Consumer Staples last week: as the S&P500 gained 0.6%, Kraft-Heinz lost 26.6% of its market value, thanks to a dividend drool followed by a big squirt of asset write-downs...

Butterwire CEO in Funds Europe supplement about AI

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Butterwire News
18th February 2019 - 1 min read

Raphael Fiorentino, CEO of UK-based fintech Butterwire, is a believer in augmented intelligence – the use of AI to complement traditional active management rather than replace it. "For decades, the industry’s pricing model has not fundamentally changed. All the pain is still passed on to the investors. They are frustrated and the reaction is to get rid of the humans. I disagree and think we should use the machines to help humans raise their game. We should strive to engineer investment knowledge and reduce fees,"says Fiorentino. "It is not about mining more historical data, it should be about gaining more insight."

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