The ROIC Engine
The article argues that return on invested capital (ROIC) is the fundamental engine behind sustainable earnings growth. It explains that high ROIC, not just headline earnings, enables companies to generate cash efficiently after the initial capital build‑out. The piece advises investors to target firms that have passed the break‑even inflection point and can grow sales without massive new cash injections. Amazon is cited as a prime example of reinvesting strong ROIC to expand a profit‑driven empire.
Right Theme, Wrong Return
Investors who correctly identified booming themes—China’s growth, robotics, ESG—still earned meager or negative returns. The VanEck FTSE China A50 ETF returned only about 2.4% annually over ten years, while the Global Robotics & AI ETF and the Australian Sustainability Leaders...
The Merits of Mediocrity
Investors who aim for modest, consistent performance often outpace high‑risk, short‑term traders over long horizons. The piece argues that avoiding the bottom quartile and preserving capital lets compounding generate superior wealth, echoing Warren Buffett’s view that a handful of outsized...
It’s All Made Up
The article argues that most of today’s market value is intangible, likening corporations to legal fictions whose worth rests on shared narratives. It highlights that even asset‑heavy firms like Alphabet derive roughly 90% of their valuation from non‑physical assets. The...