Nov

1

Recently, I've been enjoying a nightly course of steroids (ROIDS!) which has immobilized me for a half hour or so. This has provided a perfect opportunity to catch-up on junk TV.

Thankfully, I have discovered Inside The Actors Studio. It is my first encounter, albeit a long running series probably long since known to all those in the USA.

There are quite some similarities between the field of movie stardom and investing. Both are fickle industries where talent and determination are necessary, but not sufficient, conditions for success. A favorable tailwind helps. Intelligent, trusting partners matter perhaps more. Room for some failure is essential to survive. Low barriers to entry, high barriers to success.

The Studio focuses on interviewing the big stars. Some consistent themes come out in their personas, that might be familiar:

- All are highly inspired by their craft. They seem like they could talk endlessly and enthusiastically about it.

- Upbeat personalities seem a given.

- Many went through a long apprenticeship, constantly revising their core model until perfected. Others seemed blessed by the Hand of God from day one.

- Focus on process and love of the art seems to matter almost as much as the outcome. Which is good, because often others are going to hate it.

- The media of both industries has it's similarities; they're gonna puff you up one minute and deflate the next. Spine is a requisite.

- There's constant reference to precedents and pioneers in the industry; everyone's looking to to see what the other is doing.

- Mimicry and plagiarism are rife.

Some more niche analogies can be made:

- Eddie Murphy is the model trader, focused on the short term. He's got his system down cold and is constantly trying to tweak his market (the audience) for eighths and quarters (laughs). His only issue is if times change and his tastes become outmoded. The persona is so embedded, it's going to be an upheaval to adjust.

- Sean Penn and Francis Ford Copola are maybe the maverick strategists. Perhaps Jim Rogers. Brilliant, mercurial, coming up with leftfield views nobody else anticipated; always with initial backlash. Eventual vindication and celebration await. But sometimes being so far from consensus takes its toll, and turns them a little wild. They wouldn't have it any other way.

- Tom Cruise is Warren Buffett. Economics have been maximized in the principals favor. Intensive research goes into each project; this is how they de-risk. Cruise invested countless hours into Japanese history before even discussing The Last Samurai with the director. Their favored asset is the big ticket, no-nonsense production. Risk is capped, but with big upside potential.

- Pacino is Soros. He's got the full package; attacking from all angles and styles; pulling in other big guns where needed. But with an underlying dedication to craft. Occasionally he'll use sheer force of personality to get the trade or film over with.

- Woody Allen [ed: not yet on actors studio] is Marty Whitman. He's gonna grind it out; never levering up into one trade. But he's also going to concentrate his resources; finding high quality at low cost themes, producing a great risk adjusted return. His following is loyal. All this lets him sleep well at night.

- Spielberg and James Cameron are Peter Lynch. Only the Toniest product goes into the portfolio. Everything is visionary and of highest production value, but in a way that uniquely channels mainstream, not maverick tastes. Ten-baggers a plenty. And for the occasional busted asset - well they're the big dogs and can take it on the chin.


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1 Comment so far

  1. Adam K on November 2, 2012 8:26 am

    Great read Mr Owen.

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