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Tag: Christopher Brown

Season 2, Episode 15, Transcribed: Chris Brown on Healthcare, Tech Stocks

Moderator 0:02
Welcome to the Contrarian Investor Podcast. We give voice to those who challenge prevailing sentiment in global financial markets. This podcast is for informational purposes only. Nothing on this podcast should be taken as investment advice. guests were not compensated for a period, nor today’s supply payment in order to appear. Individuals on this podcast may hold positions and securities that are discussed. This is our urge to educate themselves and make their own decisions. Now, here’s your host, Mr. Nathaniel E. Baker.

Nathaniel E. Baker 2:24
Chris Brown of Aristides Capital Management. You are the manager of a long short equity fund. And interestingly enough, this fund has produced positive returns every year since inception in 2008. And I wanted to get your views here on a number of things. First of which is the fact that if I understood correctly, you are now bearish on two sectors that have done very well over the last month and that people seem to To believe, will continue to do well regardless of what happens in the broader economy. I’m talking here about tech it, and healthcare. And especially in the case of healthcare, this is something that is seen as being very much economy agnostic. Something that can, as I said, do well, even when the economy is in a downturn or a recession. And these are two areas that investors have flocked to in the equity markets over the last month or so, as I mentioned, but your views are different here. So I thought it’d be really interesting if you could share that with us.

Chris Brown 3:43
Yeah. Hey, Nat. Thanks for having me on. We’re, we’re working very hard to try to try to counter our record of not having a losing year. 2020 has been brutal so far. So yeah, I mean, I think we’ve always been kind of a very value focused, firm. And you know, for a long time, even before I had a hedge fund did my personal investing, I’d like to kind of buy the assets that were cheap into, stay away from the classes that were expensive. And, you know, I think right now, it’s funny because people see an economic slowdown. And so of course, you want to like race away from things that are cyclical or that are economically exposed. And I think people are racing towards some of the things that are, you know, seen as more defensive. And interestingly, I think whoever tweeted that this is like if the Great Depression and the NASDAQ bubble had a baby was just so spot on with that, because that’s kind of that’s what you’re seeing.

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Season 2, Episode 15: Healthcare, Tech Stocks May Not Be As Defensive As Believed

With Chris Brown of Aristides Capital

Christopher Brown of Aristides Capital joins the podcast to discuss his investment strategy, which has produced positive returns every calendar year since 2008.

Update: This podcast episode has been transcribed! Read it here.

In Brown’s view, healthcare and information technology stocks should not be treated as defensive investments that will protect portfolios in times of stress — especially after their recent run-up. There are reasons many companies in this sector are overvalued and could see their shares drop as the economy begins to see further difficulties from coronavirus.

Aristides Capital has an active short book, which framed most of the second half of the conversation.  

Content Segments: 

  • Why investors’ thinking about defensive stocks may be misguided (4:49)
  • Growth stocks’ recent performance is reminiscent of the late-1990s tech bubble (7:05)
  • The concerns with healthcare stocks (11:45)
  • Background on the guest (15:07)
  • Some of the red flags short sellers look for and why the “big picture” is often more pertinent (20:22)
  • Inovio Pharmaceuticals (NASDAQ: INO) discussion (22:52)
  • CytoDyn Inc. (OTC: CYDY) discussion (25:44)
  • Vuzix Corp. (NASDAQ: VUZI) discussion (28:37)
  • Accelerate Diagnostics (NASDAQ: AXDX) discussion (30:59)
  • Insider purchases are not always a bullish indicator (35:02)
  • Tesla Inc. (NASDAQ: TSLA) discussion, at the guest’s suggestion (host didn’t want to go there originally) and why it could be an indicator for future market direction (36:17)
  • Reasons to be bearish on markets and the economy (39:17)
  • How to protect your portfolio against inflation (42:13)

Highlights From Our YouTube Channel

For more information on the guest:

Not intended as investment advice.

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