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Kenny Powers on Investing
Multifactor World recently had the good fortune of sitting down with Kenny Powers for a question-and-answer session to discuss one of his many areas of expertise: investing. For those of you who aren’t familiar with Kenny, I wouldn’t recommend watching the show Eastbound and Down unless you aren’t easily offended. To get the full effect of this interview, all you need to do is think of the most egotistical, rude person you have ever met and know they can’t match Kenny.
 
MFW: Kenny, I’d like to thank you for taking time out of your schedule for this interview. I’d like to start by asking you what makes you qualified to discuss investing?
 
KP: One more question like that and this interview is over. Don’t EVER challenge my supremacy. Being Kenny Powers qualifies me to discuss investing.
 
MFW: Understood. So tell me how you came to be so knowledgeable about investing?
 
KP: Well it all began in high school. I started an investment club with a buddy of mine and we each put in $100. We told everybody how well we were doing and these people all contributed $100 each. My buddy and I then took all the contributed money and split it up 50/50. (Laughs)
 
MFW: Kenny, I’m no expert but that sounds a lot like a Ponzi scheme.
 
KP (getting up to leave the interview)
 
MFW: Kenny, I apologize. I’m sure it wasn’t a Ponzi scheme. Please sit back down.
 
KP: Alright, but if I get back up again, I won’t be coming back.
 
MFW: So what other experiences have you had with investing?
 
KP: I read like crazy. I’ve read every issue of Forbes and Money magazine over the last five years. I also don’t invest a dime before I watch the most recent episode of Mad Money.
 
MFW: That’s pretty cool. I read a lot too. I haven’t spent much time reading Forbes or watching Mad Money though. I’m a big fan of the Financial Analysts Journal and the Journal of Portfolio Management.
 
KP: Nerd.
 
MFW: So Kenny, tell me how you built out your portfolio.
 
KP: Right now, I have almost everything in penny stocks. I’m predicting a huge run up this year. But that’s just me. Most people can’t handle it. For regular people (sneering), I’d put everything in gold, silver, platinum and AK-47s.
 
MFW: Sounds pretty reasonable. Just curious, what were you recommending people do prior to the run up in precious metals and guns?
 
KP: Well before the run up, I was telling people to short precious metals.
 
MFW: Hmm…don’t fight the trend right?
 
KP: Exactly.
 
MFW: So what other recommendations do you have for us?
 
KP: There’s this company called Roy’s Medical Supply Store that I like. Your readers should definitely check that one out.*
 
MFW: Kenny, most of the blog’s readers believe that markets work pretty well and that the best approach to investing is to be broadly diversified, keep your investment costs low and build out a plan that reflects your ability, need and willingness to take risk. I know that doesn’t sound like your approach to investing but would you care to comment?
 
KP: Your readers sound like a bunch of wimps. Beating the market is easy.
 
MFW: Kenny, have you read Bill Sharpe’s “The Arithmetic of Active Management” or Mark Carhart’s “On Persistence in Mutual Fund Performance”? Both of those pieces show that the market is actually not that easy to beat.
 
KP: Yeah MFW I just finished reading those over tea last night. Have I read blah blah blah study? Give me a break.
 
MFW: Kenny, I want to thank you again for sitting down for the interview. It’s been a pleasure. 
 
*During our review process we discovered that Kenny owns 98 percent of this company’s outstanding stock.
 
Copyright © 2012, Buckingham Family of Financial Services. This material and any opinions contained are derived from sources believed to be reliable, but its accuracy and the opinions based thereon are not guaranteed. The content of this publication is for general information only and is not intended to serve as specific financial, accounting or tax advice. Information regarding references to third-party sites: Referenced third-party sites are not under our control, and we are not responsible for the contents of any linked site or any link contained in a linked site, or any changes or updates to such sites. Any link provided to you is only as a convenience, and the inclusion of any link does not imply our endorsement of the site.

Comments

Re: Kenny Powers on Investing

Haha...Way to keep it fresh.
at 3/29/2012 8:42 AM

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