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07/12/2008: "A leader takes his leave "

The passing of Sir John Templeton will give many professional and knowledgable private investors pause, as he was truly one of the giants on whose shoulders they have stood. He was humble enough to make the same attribution of his success to giants before him.

To those of us with the task in the '70s and '80s of persuading conservative pension-fund trustees in North America to invest internationally, John Templeton was one of the best proof statements of the rewards that come from a global sense of opportunism. And for those who resisted the developing truism that country bets were more important than company bets, he was a handy renegade. As an early exponent of country allocation in portfolio construction, I found his contrary statements in no sense inconvenient. His performance was 'explained' (after the event) by country allocation even if the size of the country bets was solely explained (before the event) by the number of cheap securities he found available. Either approach could have led to the investment he famously made in Japan in the '50s. But very few foreign investors made it.