Meet Stefan Lingmerth

We’re excited to introduce you to the always interesting and insightful Stefan Lingmerth. We hope you’ll enjoy our conversation with Stefan below.

Hi Stefan, so great to have you on the platform. There’s so much we want to ask you, but let’s start with the topic of self-care. Do you do anything for self-care and if so, do you think it’s had a meaningful impact on your effectiveness?

I like to head out for a run or go to the track to do a workout. It clears my thoughts but it’s also good for my fitness and health. I have taken my hobby a bit further and I compete in the Masters circuit. The competition forces you to structure your training and have a process to improve. A proper process is key to improve and to be able to execute in most things you do in life. This is same in business.

Appreciate the insights and wisdom. Before we dig deeper and ask you about the skills that matter and more, maybe you can tell our readers about yourself?

I have been analyzing companies and investing in the stock and corporate bond market for more than 20 years. I worked for two hedge funds in NYC from 2001 to 2020 and since 2020 I have been located in Miami. Here in Miami I have managed my money and for a couple of years I have helped others as well. I recently opened my own firm and I’m a registered investment adviser in the State of Florida. My strategy is buying out of favor stocks in companies with improving fundamentals. The research takes a lot of work and I don’t hold many investments at the time. I also publish my research on Seeking Alpha and if you don’t know the site I highly recommend you to check it out. The stocks being out of favor usually means the companies are in some sort of trouble. Perhaps the business cycle is bad and/or the balance sheet is in trouble or any other reason. However, I get really excited when it’s clear there are improvements and the market is not pricing it in. It really gets me going. I think it’s important to have a positive outlook in general in life but particular investing in stocks when most people would dismiss it. That was one of the reasons for naming my firm Sunshine Kapital. Another reason was living in Miami, which is really the sunshine capital of Florida. I’m also Swedish and in Sweden we spell capital – kapital.

There is so much advice out there about all the different skills and qualities folks need to develop in order to succeed in today’s highly competitive environment and often it can feel overwhelming. So, if we had to break it down to just the three that matter most, which three skills or qualities would you focus on?

In my case, investing in stocks, you need the tools and the skills for it and you won’t learn it in college. It will take years of practicing it. However, having common sense will get you far. I have a saying, abbreviated KISS, which means keep it simple stupid. Way too many people complicate things. Another quality would be having patience. Your business won’t grow over night it will take time. Same with my investments, they usually play out over at least a year or two.

Thanks so much for sharing all these insights with us today. Before we go, is there a book that’s played in important role in your development?

I have followed and read many books by and about Warren Buffett. I have also attended most of the Berkshire Hathaway shareholders meeting since 2007. Another book that have stayed with me is Capital Returns by Edward Chancellor. It’s about the investment examples of Marathon Asset Management. The takeaways from most of the investments they made was, excess returns will be made when the industry is out of favor and few participants would enter. As more participants enters the excess returns will disappear. It’s easy to get carried away and do what most people do. I have chosen to be a contrarian.

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