Julian Hart Robertson Jr.
Julian Hart Robertson Jr. was born on June 25, 1932, in Salisbury, North Carolina, and died on August 23, 2022, aged 90, at his Manhattan home. ◦ He served as a U.S. Navy officer from 1955 to 1957 and worked as a stockbroker at Kidder, Peabody & Company before founding Tiger Management. ◦ He contributed over $2 billion to charity during his lifetime, was a signatory to The Giving Pledge, and had a net worth of $4.8 billion at his death. ◦ He mentored notable hedge fund managers known as "Tiger Cubs," including Andreas Halvorsen, Stephen Mandel (Lone Pine Capital), Lee Ainslie (Maverick Capital), and Chase Coleman III. ◦
Robertson believed that the best way to manage money was to go long and short stocks, stating that if the 50 best stocks one could identify did not outperform the 50 worst, one should be in another business. ◦ He described his mandate as finding the 200 best companies in the world to invest in and the 200 worst to short. ◦ In his March 2000 closing letter, he wrote that the key to Tiger's success had been a steady commitment to buying the best stocks and shorting the worst. ◦ He argued that avoiding big losses was the way to really make money over the years. ◦ He viewed value investing as having a long horizon, noting that many great value investors produced terrible returns from 1970 through 1975 and from 1980 to 1981 but then came back in spades. ◦
Robertson summarized his decision process as "Smart idea, grounded on exhaustive research, followed by a big bet." He also described it as "Hear a story, analyze and buy aggressively if it feels right." ◦ For short positions, he looked for a bad management team and a wildly overvalued company in an industry that was declining or misunderstood. ◦ He believed it was easier to create a batting average in a lower league rather than the major league because the pitching was not as good down there. ◦ He noted that there were not a whole lot of people equipped to pull the trigger and that he was normally the trigger-puller. ◦ When evaluating companies, the first thing he asked was whether the management was decent and honest. ◦
He operated with a long/short equity framework, pairing the best companies against the worst as a fundamental logic test. ◦ He also described his mandate as finding the 200 best companies in the world and investing in them, and finding the 200 worst and going short on them. ◦ He distinguished between rational environments, where his strategy functioned well, and irrational markets, where earnings and price considerations took a back seat to mouse clicks and momentum. ◦ He characterized the dot-com era as a Ponzi pyramid destined for collapse, fueled by the performance desires of investors, money managers, and financial buyers. ◦ He used a minor-league versus major-league analogy to describe the search for exploitable edges. ◦ He prioritized capital preservation through the avoidance of big losses. ◦
Robertson founded Tiger Management in 1980 with $8 million in initial funding; the fund grew to a peak of $22 billion in assets in 1998 and was closed in March 2000. ◦ From 1980 to 1998, Tiger returned 31.7% per year after fees, versus the S&P 500's 12.7% annual return, and showed losses in only four of its 21 years. ◦ He seeded roughly 50 Tiger Cub firms, typically maintaining a 20-25% stake. ◦
Robertson's relentless analytical style was captured by colleagues who noted that "Why?" was his favourite word and "Prove it" his constant refrain. ◦ He combined a "Southern gentleman and drill sergeant" demeanor, systematically destroying analysts' ideas before helping rebuild them. ◦
He systematically destroyed analysts' ideas before helping rebuild them, combining a "Southern gentleman and drill sergeant" demeanor. ◦ He also described himself as the "trigger-puller" who could pull the trigger when others could not. ◦ He maintained that great value investors often suffered terrible returns for years before coming back in spades. ◦ Yet he closed Tiger because he frankly did not understand the irrational market where earnings and price took a back seat to momentum. ◦ He saw no point in subjecting investors to risk in a market he did not understand. ◦ He ultimately said he could not wake up at age 95 worrying about his partners' money, adding that he loved his life so much now. ◦
Robertson expected analysts to withstand constant interrogation, as "Why?" was his favourite word and "Prove it" his constant refrain. ◦ He prized competitiveness in hiring, asking whether a candidate was a competitor who would get into the batter's box and crowd the plate. ◦ He noted that athletics actually meant a lot and used a psychological test lasting about three hours that tried to assess whether a person was thoroughly honest or trying to game the test. ◦ He credited the success of Tiger to the young people who worked there. ◦