Menu
Clone of Alibaba (BABA) IPO Shares Jump 36%

Alibaba (BABA) IPO Shares Jump 36%

The Sexiest Halloween Costumes of 2014

The Sexiest Halloween Costumes of 2014

Mazda Miata 2016 model revealed

Mazda Miata 2016 model revealed

Miley Cyrus New Butt Gets in Trouble with Law

Miley Cyrus New Butt Gets in Trouble with Law

Larry Ellison Steps Down as CEO of Oracle

Larry Ellison Steps Down as CEO of Oracle

What a Year for Entrepreneurs!

Jan 6 2014, 3:16pm CST | by , in News

What a Year for Entrepreneurs!
Photo Credit: Forbes
 
 

Please note that Dr. Shulman is a principal in several investment advisory companies, both SEC-registered and private. In this capacity Dr. Shulman advises SEC-registered mutual funds as well as private funds and private accounts which may currently, or may  in the future, hold, buy or sell securities mentioned in this publication. Also, any such securities may have been held or sold in the past. Investment necessarily involves risk and investors should consult a qualified investment professional who is aware of their financial situation before implementing any financial strategy or investing in any security discussed. This communication is for information only and is not an offer or advertisement of any services, security or strategy.

As most investors know, 2013 was a banner year.  Leading indices such as the S&P and Russell had stellar returns.  But true to historical patterns, a basket of publicly traded “Entrepreneurial” companies did even better.  How much better?  A US All Cap composite generated more than 45% and a US Large Cap composite of entrepreneurs soared above 55%.   Benchmarked against the S&P 500’s 32%, this was a significant out performance by any standard.  How could this be?

Outstanding gains from iconic companies such as Tesla (344%) and Netflix (298%) led the way, but other entrepreneurial companies such as 3D systems (161%), Groupon (142%) and Splunk (137%) also contributed gains.  Even Facebook (105%) and Blackstone (102%) joined the party.

What makes these companies so impressive?  It generally starts at the top.  Entrepreneurs build strong, loyal teams and create incentives to grow organically.  They also tend to keep their costs lean (relative to competitors) and remain focused on long-term wealth generation.  But owner-managers provide no guarantee for success.  Brazil’s Mineracao Metalicos (-86%), driven by fallen billionaire Eike Batista, lost virtually everything in 2013.  Other investor tragedies such as gold producer Endeavour Mining Corporation (-77%) provide caution for any investor seeking easy fortune, particularly in emerging markets.

So, should investors seek publicly traded entrepreneurial companies in 2014?  Maybe…  If you think the markets will continue to rise then entrepreneurial companies tend to perform better in strong markets. But they typically provide little risk protection in weak ones.  Best advice?  Spread your money across a portfolio of companies with leaders who run the companies as if it is their own money.  Our research shows this strategy often works over an extended period of time.

Source: Forbes

You Might Also Like

Updates

Shopping Deals

 
 
 

<a href="/latest_stories/all/all/31" rel="author">Forbes</a>
Forbes is among the most trusted resources for the world's business and investment leaders, providing them the uncompromising commentary, concise analysis, relevant tools and real-time reporting they need to succeed at work, profit from investing and have fun with the rewards of winning.

 

 

Comments

blog comments powered by Disqus

Latest stories

White House evacuated after Breach of Security
White House evacuated after Breach of Security
The White encountered a breach of security and had to be evacuated after a man traversed the fence and almost succeeded in reaching the front doors of the residence of the President.
 
 
Sophia Loren Turns 80 Today
Sophia Loren Turns 80 Today
Iconic actress, Sophia Loren is celebrating her 80th birthday today.
 
 
Macy’s Black Friday
Macy’s Black Friday
Department stores, to many people, seem like a part of a bygone era. In reality, there are many that are still doing well and Black Friday is an excellent example of this. When you look at the kinds of deals that Macy’s...
 
 
Hacking (the hair) of Kaley Cuoco-Sweeting
Hacking (the hair) of Kaley Cuoco-Sweeting
How does a young celebrity handle being hacked and dealing with leaked pictures? By taking the situation into her own hands and not backing down.
 
 
 

About the Geek Mind

The “geek mind” is concerned with more than just the latest iPhone rumors, or which company will win the gaming console wars. I4U is concerned with more than just the latest photo shoot or other celebrity gossip.

The “geek mind” is concerned with life, in all its different forms and facets. The geek mind wants to know about societal and financial issues, both abroad and at home. If a Fortune 500 decides to raise their minimum wage, or any high priority news, the geek mind wants to know. The geek mind wants to know the top teams in the National Football League, or who’s likely to win the NBA Finals this coming year. The geek mind wants to know who the hottest new models are, or whether the newest blockbuster movie is worth seeing. The geek mind wants to know. The geek mind wants—needs—knowledge.

Read more about The Geek Mind.