The Wisdom of Herb Greenberg

We have been lucky to meet and work with some incredible folks in our thirty-year career. One of the best is my old friend and colleague, Herb Greenberg.

Many of you are probably familiar with Herb.

He began his career as a journalist more than forty years ago and, after several stops, built a great franchise as a business reporter for the San Francisco Chronicle. He built a reputation there for doing critical reporting (and research) on the many "questionable" companies emerging during the bubble.

This attracted Wall Street's attention, and Jim Cramer eventually recruited him to his upstart financial website, TheStreet.com.

This was in 1998 when Herb and I first met. Just a year earlier, I had started as an analyst and was already a portfolio manager working on a $25 million hedge fund and $3 billion of long-only money.

While most of our assets were long only, my specialty was focusing on the short side for the hedge fund. This brought Herb and I into close contact because there was NO ONE in the media discussing shorts in any way. We soon became good mutual contacts and built a friendship.

Across the next two decades, Herb would continue to evolve his career, moving on to create a short-focused research firm. We were one of his clients!

Finally, just a few short years ago, Herb joined Whitney Tilson and me at our former newsletter company, Empire Financial.

Herb and I have known each other for more than twenty-five years, and I continue to be impressed by him.

Not only is he super bright, but he has an incredible work ethic. I'm not sure how he does it, but it feels to me like he puts in a LOT of hours!

The output of all that work is also consistently excellent. He combines a critical viewpoint with a healthy dose of plain common sense. It is a rare combination.

Recently, he joined several intelligent and experienced investors to create a new company called Wall Street Beats. 

Imagine a group of seasoned veterans gathering daily to talk about their views on the markets and what they are doing in their portfolios. Except you have a seat at the table and can hear all their insights.

He has lined up an incredible group of folks, and I think it is a terrific opportunity for investors. Again, you should check it out and subscribe.

Last week, we had the privilege of having Herb on the HX Podcast. We went through our long history and shared some stories about the past, but the last few minutes of the podcast were the most important.

(By the way, you can listen to the podcast here or watch it on YouTube here.)

On the HX Podcast, we like to ask our guests a few (three to five) pieces of advice they would give folks interested in investing but don't have the benefit of their years of experience.

In answer to this question, Herb had some powerful advice!

His advice? As an investor - KNOW YOURSELF.

Understand what your goals are, what your risk tolerances are, and what your comfort levels are.

Herb has a fascinating juxtaposition where he has been willing to take huge risks in his career, but he is very conservative as an investor.

He built an excellent portfolio of recommendations at our former firm that performed very well. They all were well-established businesses with deep moats and strong cash flow, and that paid dividends.

Herb built a portfolio of stocks that reflected his tolerances. It was a portfolio that also did great.

Here is what he said on the podcast…

“…what I said here is very basic, but you know what? I think I have a decent finger on the pulse of the average guy. And I can tell you that people get carried away. And the reality is, I come back to know what your risk tolerance is. And if your risk tolerance is that you love to be in the game, it's going to be very different than me. But you know what the reality is? There's no right or wrong way to it. There's zero. There's no right or wrong way to invest and make money.”

Where investors make big mistakes and do real damage to their wealth is when they think they are one type of investor, but they are really a different type. THIS situation leads to permanent capital loss and can set folks back.

We strongly encourage you to check out Herb’s work. Follow him on Twitter, subscribe to his newsletter on Substack, and sign up for Wall Street Beats.

You rarely find someone with this experience, critical insight, and plain old common sense. I am honored to have him as a colleague and friend.

Check out Enrique Abeyta’s conversation with Herb Greenberg of Wall Street Beats on the HX Podcast.