Every index fund quietly does something strange. When a company's founder retires, sells, or passes away, the index buys more of that company, not less. Haren Bhakta thinks that is exactly backwards. On this episode of Pale Blue Nexus, the CEO and founder of Inside Ownership Index explains why he would rather own the leaders of a business than the logo, and why he went through roughly 20,000 proxy filings by hand to build the data that proves it.
We get into the moment at the Berkshire Hathaway annual meeting that sparked the whole idea, the difference between a "zoo lion" CEO who gets fed whether or not the hunt succeeds and a "wild lion" owner-operator who feels the pain of every mistake, and a study of stocks that returned 100 times their money over 25 years, nearly all of which shared one trait before the run ever started. We also cover why the most dominant company in history faded once its owner stepped away from the board, and where disruption tends to come from once leadership no longer has real skin in the game.
Guest: Haren Bhakta, CFA, CEO and founder of Inside Ownership Index. The ETF trades under the ticker OWN.
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