Here’s a picture of me at Goldman Sachs London HQ from last night. Security had to allow me in this time as they were hosting the London Quant Finance Group’s October seminar on tricks of the (investing) trade for portfolio optimisation. Oh what an exciting life I lead.
Goldman Sachs is also colloquially known as the vampire squid and the biggest expert in implementing the tricks of the finance trade.
Let’s break down what a vampire squid does.
First the squid with its many tentacles expropriates a resource someone else has built.
In Goldman’s case this could be a corporate merger, Greek infrastructure or the US economy.
Once the squid has it’s tentacles firmly around it target, it then proceeds to extract the best bits.
So GS will then get to the party early enough to help itself to M&A fees, and the best slices of debt or equity offerings.
Vampire squidism is difficult for individual investors to implement, but here’s one example of how I would do it.
First we need to find a juicy target to get our tentacles around.
Blackrock the indexing giant has identified automation and robotics as a major growth area in coming years and offers the Automation & Robotics ETF. You can find details here.
If you do a little searching around, you can find that the companies held in the fund are selected by research from Factset, a research house I’ve long admired. You can take a look behind the index building curtain and then out of the on hundred plus companies, use your own expertise to vampire suck out the top 10-20 companies by clicking on the components of the index.
“The first thing you need to know about Goldman Sachs is that it's everywhere. The world's most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money”
Matt Taibbi, Rolling Stone