📖Jeremy Grantham
Review Your Investment Thesis
Regularly challenge your original investment thesis.
Regularly review whether your original reasons for owning a stock still hold. If the facts change, change your mind. Holding a broken thesis is the costliest mistake.
🏠 Everyday Analogy
📖 Core Interpretation
Jeremy Grantham frames investing as a compounding game. Time amplifies quality and discipline, while unnecessary activity often destroys long-horizon returns.
💎 Key Insight：Adapting to new facts prevents holding broken investments.
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❓ Why It Matters
Short-term noise often forces investors out before value is realized. Long-term discipline increases the odds that fundamentals, not emotions, drive outcomes.
🎯 How to Practice
Extend research and review horizon, reduce unnecessary turnover, and adjust only when intrinsic value, risk, or opportunity cost materially changes.
⚠️ Common Pitfalls
Calling it long term while never reviewing thesis
Overtrading and damaging compounding
Ignoring opportunity cost and alternatives
📚 Case Studies
1
U.S. Housing and Credit Bubble (2007)
Grantham highlighted extreme overvaluation in U.S. housing and risk assets, cutting exposure to equities and credit pre-crisis.
✨ Outcome：GMO avoided the worst of the 2008 collapse and then added risk as spreads and equity valuations reverted toward historical averages.
2
Dot-Com Bubble Warning (2000)
Grantham publicly warned in 1998–2000 that tech stocks were in a massive bubble, reducing GMO client exposure to overvalued growth and internet shares.
✨ Outcome：Clients underperformed during the final surge, but avoided most of the 2000–2002 crash and preserved substantial capital.
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