By Scott Ronalds

There’s an interesting firm out of London by the name of Bedlam Asset Management.  I read their literature every now and then and although we often don’t share the same views, I’m always impressed by their transparency.  There’s no beating around the bush at Bedlam.  Case in point, an excerpt from one of their recent publications.

One of the dumbest and most popular questions we are asked is, “When will bank share prices bottom?” If we knew the answer to the most important issue in bond and equity markets, do you really think we would tell you first, for free, or before we had bought them for our clients? We may be the most transparent fund management firm in the world, but we’re not so brainless you can shine a torch in one ear and see the beam coming out of the other. The question is also bizarre. We are the least qualified fund management company on the planet to give an answer; for we are the only one we know of which neither owns, nor has ever owned shares in a bank in the English speaking world. Why not ask the huge institutional shareholders? Given Banks still constitute probably the largest parts of their portfolios, they must believe they are terrific value, or else they would not be investing your money there? Or why not ask the investment department of a bank? Suggested blue-chip names include UBS, Citigroup, Merrills, Bradford & Bingley, Societe Generale and AIG.