Top 50 Microcap Manager List: Connor Haley
The next feature of our Top 50 Microcap Managers list is Connor Haley of Alta Fox Capital. Prior to the founding of Alta Fox, “Connor worked at Scopia Capital Management LP, a multi-billion dollar long/short investment fund in New York.” Additionally, Connor was President of the Harvard Financial Analysts Club while earning an A.B. in Government and ultimately graduated magna cum laude. “After more than a decade of successfully investing and advising capital for family” and friends, Connor founded Alta Fox Capital Management in 2018.
Read our feature on Connor Haley
Money Dreams
“Students of financial history can point to historic levels of valuation to suggest that we are in a bubble. But students of psychology may be needed to complete the picture. For one thing, the financial markets have been so strong for so long that fear of market risk has mostly evaporated. People who used to hold bank certificates of deposit now maintain a portfolio of growth stocks. It is not really within human nature to comprehend that you may not know everything you think you know, and, further, that what you believe in could change on a dime.” —Seth Klarman
To some extent, the quote above could have been written today. Those who look to the distant past have cause for concern at today’s valuations. Those who look to the more recent past find comfort in quick recoveries and a friendly Federal Reserve. Even the bearish forecasts that (very) occasionally show up on T.V. don’t usually sound too bad.
Of course, the above quote wasn’t written today. It was penned in June of 1999. Back then, people were day-trading all things technology, and leaving a few places—such as small caps and REITs—for the few courageous value investors still in business. Today, there is plenty of day-trading, whether in stocks that still have dreams of making money, or in cryptocurrencies with dreams of being money. As we wrote last month when discussing the housing market, history often rhymes. And at least in some areas of the market, today’s dreams could end up for many like they did once the late 90s bubble burst, when the Nasdaq lost over 80% of its value and the S&P 500 dropped by nearly half.
“The better you know a particular historical period, the harder it becomes to explain why things happened one way and not another…. It is an iron rule of history that what looks inevitable in hindsight was far from obvious at the time.” —Yuval Noah Harari (“Sapiens: A Brief History of Humankind”)
It has been said that the only phrase more dangerous than “this time is different” is the phrase “this time is never different.” Maybe high valuations today will lead to lower and lower prices soon. Or maybe things really are different in the economic world in which we find ourselves in 2021. Whether you are a bull or bear on one thing or on many things today, you could probably use either of those phrases to justify your position. Humans, as evolved and sophisticated as we are, tend to still, after all these years, be especially good at twisting whatever facts are at hand to suit our beliefs.
“So convenient a thing it is to be a reasonable creature, since it enables one to find or make a reason for everything one has a mind to do.” —Benjamin Franklin
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