📈 How Thomas Russo Beat The Market For 30+ Years

Thomas Russo’s philosophy was shaped in 1982 at Stanford, when Warren Buffett told his class that the real edge in investing is the non-taxation of unrealized gains — so invest in something that lets you be right once. Russo built his entire career around that idea.

He stopped chasing cheap stocks and focused on long-term franchises with strong brands, pricing power, and loyal customers - what Buffett called “economic goodwill.”

🟡 The Power of Brands
Russo buys companies people never replace: Nestlé, Heineken, Hermes, Apple. He looks for brands that can raise prices without losing customers and stay relevant for decades. He calls this the “capacity to suffer” - the willingness to sacrifice short-term profits for long-term brand strength.

See’s Candies and Hermes “suffer” by keeping exclusivity and never discounting. Others like Starbucks and Gucci, he notes, diluted their brands by chasing quarterly gains.

🟡 Zero Tolerance for Mismanagement
Russo immediately sold Altria after its failed Juul investment and dumped Wells Fargo after its scandals. His rule is simple: if management stops acting in shareholders’ best interest, sell — no matter the profit history.

🟡 The Lesson
Russo’s fund has compounded at 11.9% annually for decades. His edge is patience, discipline, and conviction. He holds enduring brands through market cycles and lets time do the work.

The secret isn’t brilliance. It’s owning great businesses that can “suffer today to dominate tomorrow.”

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