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Kenneth L. Fisher

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Kenneth L. Fisher (born November 29, 1950) is an American businessman and the founder, chairman, and CEO of Fisher Investments, a money management firm headquartered in Woodside, California. Fisher writes the monthly “Portfolio Strategy” column in Forbes magazine, contributes to other financial and news magazines, has authored four books, and has written research papers in the field of behavioral finance. [1]

Early years

Kenneth L. Fisher was born November 29, 1950 in San Francisco, California, the third and youngest son of Philip A. Fisher, an investor and author of Common Stocks and Uncommon Profits. Ken Fisher was raised in San Mateo, California. He initially went to Humboldt State University to study forestry, but graduated with a degree in economics in 1972.[2] Upon graduating, he worked for his father’s money management firm in the 1970s, before starting his own firm, Fisher Investments, in 1979.[3]

Professional career

Fisher Investments

Fisher founded Fisher Investments in 1979, which now manages over $45 billion (as of September 30, 2007) for private clients and institutions. The firm also has a significant presence in both the UK [4] and Germany. [5]

Investment Results

Fisher has been writing the “Portfolio Strategy” column in Forbes since 1984, making him the fourth-longest running Forbes columnist in Forbes 90+ year history. Each column details Fisher’s current market outlook, and usually has 4 to 6 recommended stocks. (According to Fisher's January 28th, 2008 column, if you had bought all 60 of Fisher 2007 recommendations you would be up 0.9%.) [6]

Based on the Forbes recommendations, CXO Adisory Group ranks Fisher as number two most accurate market forecaster, as of February 12th, 2008, with the accuracy rate of 67%. (Note a decline from the number one slot with 70% accuracy from their previous update.) [7]

Fisher Investments SEC Public Filings are maintained in the EDGAR public database [8]. The database is culled by Guru Focus to extract data on all purchases and sales of securities by the gurus they track. Performance is updated on a daily basis and all gurus are ranked based on their current performance. As of February 12th, 2008, Kenneth Fisher ranks at #18 with an average 12 month return of -7.12% [9]

Price-to-sales ratio

Fisher’s theoretical work identifying and testing the price-to-sales ratio (PSR) is detailed in his 1984 Dow Jones book, Super Stocks. He is credited with being the first to define and use the PSR to identify undervalued stocks.[10] In Fisher’s most recent book, The Only Three Questions That Count, he states the PSR, being widely used, is no longer an indicator for undervalued stocks.[11] However, the PSR is still frequently included as required curriculum for the chartered financial analyst exam.[12]

Small cap value

Small-cap value was not defined as an investing category until the late 1980s. Fisher's firm, Fisher Investments, was among the first institutional money managers offering small-cap value investing to clients.[13]

Behavioral finance

Fisher is active in the field and study of behavioral finance. He has co-authored several research papers on the topic in collaboration with Meir Statman, the Glenn Klimek professor of finance at the Leavey School of Business at Santa Clara University.[14]

Accomplishments

Fisher is currently ranked #271 on the 2007 Forbes 400 list of richest Americans, and has been on the list since 2005.[15]

Fisher won a Bernstein Fabozzi/Jacobs Levy Outstanding Article Award for "Cognitive Biases in Market Forecasts," a paper co-authored with Meir Statman on behavioral finance appearing in the Fall 2000 issue of Journal of Portfolio Management.[16]

Personal life

Fisher lives in Woodside, California with his wife, Sherrilyn. They have three grown sons. His hobbies include the history of Kings Mountain, a community located in Woodside. He's written and lectured extensively on Kings Mountain and California History, and is a member of the San Mateo County Historical Association.[17]

He also takes an active role in researching redwood lumbering history, having located and excavated more than 35 pre-1920 steam-era lumber mills.[18] Fisher is considered "one of the foremost experts on redwood logging during the 19th century," serving as a resource for others who research and write about coastal redwoods.[19][20]

He endowed the Kenneth L. Fisher Chair in Redwood Forest Ecology at his alma mater, Humboldt State University in order to support the study of coastal redwood ecology. The chair is currently held by Stephen C. Sillett, a biology professor at Humboldt State. [21]

Books and other authorship

Fisher has authored four investing books – Super Stocks (Dow Jones, 1984), The Wall Street Waltz (McGraw Hill, 1987), 100 Minds that Made the Market (McGraw Hill, 1993), and The Only Three Questions That Count (John Wiley & Sons, 2006). The Only Three Questions That Count was a New York Times best seller for three months in 2006. Also, it made Wall Street Journal and BusinessWeek best seller lists.

Fisher wrote the introductions to the Wiley Classics Series re-publications of Common Stocks and Uncommon Profits[22], Paths to Wealth through Common Stocks [23], both by Philip A. Fisher, and The Battle for Investment Survival[24] by Gerald M. Loeb. Fisher also wrote the introduction to The Warren Buffett Way by Robert Hagstrom.[25] Fisher's books have been translated to German, Spanish, Portuguese, Korean, Japanese, Chinese, and Italian.[26]

Fisher has also authored investment related articles appearing in Research,[27] Financial Planning,[28] [29] Journal of Portfolio Management, The Financial Analyst’s Journal, The Journal of Investing, The Journal of Psychology, and The Journal of Behavioral Finance,[30] among others. Fisher's "Portfolio Strategy" column in Forbes has appeared monthly for 23 years. In the UK, Fisher has written for Bloomberg Money, Investment Week, and The Financial Times.[31][32] He currently writes monthly columns for UK investment blog Interactive Investor,[3] and a weekly column in a major German newspaper Handelsblatt.[4]

Further reading

  • "Doing it Right," by James J. Green. Investment Advisor. June 2007.[5]
  • "Never Enough Fisher," by Anthony W. Haddad and Jonathan Bernard. Equities. September 2007.[6]
  • Market Gurus: Investing Strategies You Can Use from Wall Street's Best by John P. Reese and Todd O. Glassman. Validea Press. 2005.
  • The Money Monarchs: The Secrets of 10 of America's Best Investment Managers by Douglas J. Donnelly. Irwin Professional Pub. 1992.
  • Super Stocks by Kenneth L. Fisher. McGraw Hill. 1990.

Other research

  1. “Market Timing in Regressions and Reality.” Fisher, Kenneth L., and Meir Statman. The Journal of Financial Research, Fall 2006: 293-304. [7]
  2. “Market Timing at Home and Abroad.” Fisher, Kenneth L., and Meir Statman. The Journal of Investing, Summer 2006: 19-27. [8]
  3. “Sentiment, Value, and Market-Timing.” Fisher, Kenneth L., and Meir Statman. Financial Analysts Journal, Fall 2004: 10-21. [9]
  4. “Consumer Confidence and Stock Returns.” Fisher, Kenneth L., and Meir Statman. The Journal of Portfolio Management, Fall 2003. [10]
  5. “Bubble Expectations.” Fisher, Kenneth L., and Meir Statman. The Journal of Wealth Management, Fall 2002: 17-22. [11]
  6. “Blowing Bubbles.” Fisher, Kenneth L., and Meir Statman. The Journal of Psychology and Financial Markets, 3.1 (2002): 53-65. [12]
  7. “Cognitive Biases in Market Forecasts.” Fisher, Kenneth L., and Meir Statman. The Journal of Portfolio Management, Fall 2000: 72-81. [13]
  8. “Investor Sentiment and Stock Returns.” Fisher, Kenneth L., and Meir Statman. Financial Analysts Journal, Mar/Apr 2000: 16-23. [14]
  9. “A Behavioral Framework for Time Diversification.” Fisher, Kenneth L., and Meir Statman. Financial Analysts Journal, May/June 1999: 88-97. [15]
  10. “Investment Advice from Mutual Fund Companies.” Fisher, Kenneth L., and Meir Statman. The Journal of Portfolio Management, Fall 1997: 9-17. [16]
  11. “The Mean-Variance-Optimization Puzzle: Security Portfolios and Food Portfolios.” Fisher, Kenneth L., and Meir Statman. Financial Analysts Journal, July/Aug 1997: 41-50. [17]

References

  1. ^ http://scholar.google.com/scholar?q=%2B%22KL+Fisher%22+%2B+%22M+Statman%22&btnG=Search
  2. ^ "Shaking it Up," but Vernon Felton, Humboldt Stater, Fall, 2006.
  3. ^ See "Bay Area Billionaires" by Jennifer Roberts, San Jose Magazine, February, 2007
  4. ^ “Wealth Management.” By Tom Burroughes. The Business. 14 July 2007.
  5. ^ “Fisher Investments expands into Germany.” [Reuters. Jul 16, 2007.[1]
  6. ^ Forbes.com - Ken Fisher
  7. ^ CXOAG Guru Grades
  8. ^ Fisher Investments SEC public filings
  9. ^ Guru Focus - Kenneth Fisher
  10. ^ What Works on Wall Street by James O'Shaughnessay. McGraw Hill, 2005.
  11. ^ The Only Three Questions that Count: Investing by Knowing what Others Don’t. Kenneth Fisher with Jennifer Chou and Lara Hoffmans. John Wiley & Sons. 2006
  12. ^ https://www.cfainstitute.org/cfaprog/courseofstudy/pdf/cbok.pdf
  13. ^ Fisher hires reps to gather assets for him to run on a discretionary basis
  14. ^ http://scholar.google.com/scholar?q=%2B%22KL+Fisher%22+%2B+%22M+Statman%22&btnG=Search
  15. ^ #271 Kenneth Fisher - Forbes.com
  16. ^ Five Years of Award-Winning Articles from The Journal of Portfolio Management. Peter L. Bernstein, Frank J. Fabozzi, Bruce I. Jacobs, Kenneth N. Levy. Institutional Investor. 2005.
  17. ^ "Kings Mountain's Coloforful History," The Journal of the San Mateo County Historical Association, Volume XXVI, No. 3, November 1990.
  18. ^ "Bay Area Billionaires" by Jennifer Roberts, San Jose Magazine, February, 2007.
  19. ^ "Shaking it Up," but Vernon Felton, Humboldt Stater, Fall, 2006.
  20. ^ Coast Redwood: A Natural and Cultural History Michael Barbour, et. al. Cachuma Press, Los Olivos, CA. 2001.
  21. ^ The Boldt :: HSU Alumni News
  22. ^ Common Stocks and Uncommon Profits and Other Writings. Phillip A. Fisher. John Wiley & Sons. 2003.
  23. ^ Paths to Wealth through Common Stocks. Phillip A. Fisher. John Wiley & Sons. 2007.
  24. ^ The Battle for Investment Survival. Gerald M. Loeb. John Wiley & Sons. 2007.
  25. ^ The Warren Buffet Way, Second Edition. Robert G. Hagstrom. John Wiley & Sons. 2005.
  26. ^ John Wiley & Sons Inc., 2007 Annual report.[2]
  27. ^ http://www.researchmag.com/cms/Research/Monthly%20Issues/Issues/2007/02/Index/Features/02_f_investingscience?searchfor=ken%20fisher
  28. ^ We Are the World: Does the current inversion in the U.S. yield curve spell trouble ahead? These days, it's the global yield curve that matters
  29. ^ The Only Three Questions that Count: How can you discover something the crowd doesn't know? It's not so hard to find patterns that will give a bet-able edge
  30. ^ http://scholar.google.com/scholar?q=%2B%22KL+Fisher%22+%2B+%22M+Statman%22&btnG=Search
  31. ^ FT.com / Markets / Investor's notebook - Insight: History teaches this is just a bull market correction
  32. ^ FT.com / Markets / Investor's notebook - Market insight: Be bullish and watch the bears impale themselves
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