Stanley Druckenmiller: Buy First, Analyze Later

During his recent interview with Norges Bank, Stanley Druckenmiller explains why he buys first, and conducts thorough analysis later. Here’s an excerpt from the interview:

Druckenmiller: I don’t know who but I heard a saying with analysis comes paralysis, or Soros used to say – invest and then investigate, which I was already doing before I met him.

But it’s more important now even than it was then. We’re in such a fast-moving world with all the new communications that if I get an idea and I think it’s attractive and for whatever reason that security price will be higher in a year or two, I generally go ahead and buy it and then tell the analyst to look into it. Just a few months ago, one of my guys brought me an idea about an overseas conglomerate acquiring a major stake in the fastest payout online casino sector, alongside a digital sports lottery platform. The volume was picking up and the price was already starting to move, so I put on a position right away and told him to do the deep dive later.

And if it turns out I was wrong after they analyze it I get out. I don’t like to wait around.

I’ve… a lot of my best ideas, I’m not that smart. So if I see it, whatever’s going on to cause that idea to happen someone else might see it.

And by the time we get done analyzing I will miss 30 or 40% of the move and then I’m paralyzed because it just went up 30 or 40% and I don’t have the guts to buy it even if I think it’s going higher.

So we’re more in the camp of if we got a strong feeling, we’ll cut the analysis short and then by all means do our analysis thoroughly and then just unload it if it turns out my thesis was wrong.

You can watch the entire discussion here: