Model Portfolio jackweyland:VALUE

My name is Jack Weyland. I was born and raised in Marin County, CA and am passionate about investing, music, sports, science, and self-improvement.

I'm a self-educated investor

My journey into the financial markets began over 15 years ago with the book, The Wall Street Guide To Understanding Money and Investing. Since then, I have experienced real world successes and failures in the financial markets while extensively familiarizing myself with fundamental analysis, stock chart analysis, allocation strategies, and decision-making discipline.

Over the past 15 years I have developed a unique perspective that values information and data in a different way mainly through my spiritual journey and my persistent state of research. While, I did attend a top-10 business college with the intention of becoming a money manager, I dropped out after two years and a 3.6 GPA with serious questions about my direction and my development as a person.

I funded my 10-year "Hajj" by serving in the U.S. Air Force, working for a regional airline, and working as a professional driver - all security sensitive occupations. In that time, I've accumulated the knowledge and experience to allow me to find spiritual balance and design a framework for me to become the best possible person that I can be.

The book: The Psychology of Judgment and Decision Making, by Scott Plous, Ph.D. has influenced me a great deal and I attribute much of my success in life to the insights and perspectives it gave me and the principles from it that I have applied. While I highly recommend reading this book, particularly because it brings to light the folly of most human perspectives, let me focus on the two concepts that have had a significant impact on how I approach investing: Heuristics and Common Traps.

Heuristics

Heuristics are experience-based techniques that help in problem solving, learning and discovery. Here are a couple of examples:

1. Probability and Risk: Being able to conceptualize probability and assess risk accurately and to make decisions without emotion. This ability was particularly important during the turbulent market in 2008 when many investors panicked and sold at the bottom and then bought back when the market had recovered 30%.

2. Break Compound Events into Simple Events: Stock prices are generally influenced by multiple compound events that make assessing probability much more complicated. I have found the key to analysis is to break those compound events down into simpler events ones that I can use prior experience or knowledgeable and valid sources to make logical decisions. An example is breaking down the potential success of a drug by asking simple questions. Does it solve a real problem? Do the benefits justify the risks to a patient? Is it superior to what is already on the market? Is there pent up demand?

Common Traps

1. Don't Be Misled by Highly Detailed Information: Analyst reports are well written with plenty of numbers and "analysis" that back-up their conclusions which can appear compelling because of the overwhelming amount of data analysis; but their conclusions can be wrong. Detailed information is not a substitute for judgment but it often is used that way.

2. Overconfidence: Operate without emotion and without bias. Don't put all your eggs in a single basket

3. "Sunk Cost Effect": Cut losses when appropriate and move on.

I primarily invest in Health Care although on occasion I will also invest in other sectors like Materials, Energy and Information Technology, and Industrials. I became interested in Health Care investing ten years ago because of the long-term demographics: aging population and increasing longevity trends but mostly because of the potential for price inefficiencies. It can take years for a promising drug to go through the FDA approval process and rarely does that process go without hiccups. During that extended time generally problems, uncertainties, risks, fears, etc. arise and because the science behind these drugs and the disease can be complex, investors over-react and sell off.

Besides Health Science research and investing, I am a music producer on the weekends. I have started a music project called Cylonagen. The music is Sci-Fi themed with beats and atmospheres. The music will be available on Amazon.com and iTunes beginning summer, 2009. I intend to release new material every year.

Posted by Jack Weyland at 6:21 PM | Permalink