British housecat beats pros in 2012 stock picking
In a very different take on “natural” investing, a housecat in England has won a year-long portfolio challenge, beating out teams of three professional investment managers and business school students. Orlando had a fantastic 4th quarter, surging past the professional team on the basis of his finely honed technique of tossing his favorite toy mouse onto a grid of companies he could invest in.
The stock management challenge was organized by The Observer, which reported on the results in January. Orlando managed to end the year up by over 10% from his starting stake of five thousand pounds, while the pros gained about 3%, and the students lost about 3% on the year—though the students hold bragging rights for the final quarter, during which they beat even the surging Orlando.
The Observer notes that
The result indicates that the “random walk hypothesis”, popularised in economist Burton Malkiel’s book A Random Walk Down Wall Street, is perhaps truer than we thought. Burkiel’s book explores the idea that share prices move completely at random, making stock markets entirely unpredictable.
We wouldn’t go that far, but neither will we be turning to Orlando for advice: the Observer notes he is unavailable for consultation because of a claws in his contract.
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