The Variant View

One way to think about why a stock can appreciate in price is that its price reflects the consensus expectation of the company’s future growth, and that consensus can be wrong.

The variant view of a successful investor is being able to stand independent of the market, identify a company whose future growth as determined by the consensus is wrong, and arrive at a more accurate analysis of the business.

In other words, it is akin to identifying a money printer that prints $10 every time when everyone else thinks it only prints $5. You do not just need to find a good business; you need to find an expectation gap where you are both different and right.