Holding your nose and investing in value

So what do value investing and a medical treatment known as ‘FMT’ have in common? You might want to finish eating before you read any further…



Andrew Lyddon
Fund Manager, Equity Value

Here on The Value Perspective, we never shy away from a strong analogy as we seek to convey the benefits of a value-oriented investment strategy.

Still, while what follows is unarguably strong, we appreciate it may also be pushing the boundaries of good taste and so, should you be in the habit of reading our articles while eating lunch at your desk, say, you may wish to finish that sandwich first.

Done? Good.

Because what we are about to discuss is the process of Faecal Microbiota Transplantation, which we learned about from Ed Yong’s eye-opening exploration of the world of microbes, I Contain Multitudes, and involves the treatment of certain gastrointestinal diseases through the patient – there really is no delicate way of putting this – ingesting freeze-dried pellets of a healthy person’s faeces.

No, that would not be our first choice of a cure either and yet, if you were suffering from clostridium difficile infection, for example, ‘FMT’ really does seem to be what you should be asking your doctor to prescribe.

In 2013, writes Yong, a particularly robust set of trials showed this to be highly effective where antibiotics tend to struggle and it has been regulated by the US’s notably fastidious Food & Drug Administration ever since.

And the value parallel?

Well, like FMT, a value investment strategy involves going against every instinct you have to do the thing you least want to do – voluntarily taking on board something other people have quite literally discarded and go out of their way to avoid.

Those brave enough to do so are in a position to benefit from a highly effective process that history shows can lead to a very good result. We will leave it there.

Past performance is not a guide to future performance and may not be repeated. 


Andrew Lyddon
Fund Manager, Equity Value


The Value Perspective
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