The Art of “So What?”




A good investor is one who can distill the important from all the noise of information. There are literally hundreds of different metrics a knowledgeable investor has at his disposal in evaluating a company. Because of a difference in mandate (from the buy-side), sell-side research reports tend to have their fair share of unnecessary information as well. Depending on the type of investor you are, certain information will be more or less valuable.


To cut through all the clutter, or to avoid succumbing to herd mentality, I invariably find myself thinking “so what?” every time I encounter a new piece of information. The art of “so what?” – I find to be quite nifty. Frequent readers may notice that I’m usually not one for writing nebulous, philosophical articles. Admittedly, the inspiration came from reading one of the many tribute articles on the late Mr Lee Kuan Yew. This one was from Education Minister Heng Swee Keat at a conference titled ‘The Big Ideas of Lee Kuan Yew” which I have reproduced below.

“SO?” was Mr Lee Kuan Yew’s favourite question, recalled his former principal private secretary (PPS) Heng Swee Keat.

He would pose this question when presented with reports on developments. He would often repeat this question to probe any explanation he was given.

These queries would always be followed up by asking: “So, what does this mean for Singapore?”

Recounting this at a day-long conference on the former prime minister’s big ideas, Mr Heng said that this was Mr Lee’s way of “cutting through the clutter” to get to the heart of issues the country faced and tackle them.


In a similar vein, investors can ask themselves – one; what does this mean for the company and two; what does this mean for me as an investor? Ideally, the answers should also be a central part of your eventual investment thesis. Based on this simple litmus test, certain information become inconsequential because of its tenuous relationship with the company and the investor. The incremental benefit of new information becomes marginal past a certain point. Remember, the 80-20 rule.


When a broker excitedly champions a stock with a 10% free cash flow yield, ask yourself “so what?” before you take the plunge. So what does a 10% free cash yield mean to me? It means that for every dollar I put into the business, I get 10 cents of cash which I can use as dividends, or re-investment. So what? Why is this attractive to me? Is it by the mere fact it is in the highest decile of the stock universe? So what? How is it important to my investment objectives?  If you are someone gunning to double your portfolio in a year, the consistency of a 10% free cash flow yield will be hardly relevant – you will be looking for large earnings jumps and catalysts. As opposed to someone who is a pure dividend investor, the question of “so what?” will yield different answers.


Drawing a strong link between a piece of information and your investment thesis is a key part of investing. It is the beauty of these two words which forms the canvas in the art of investing.


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All views and opinions articulated in the article were expressed in Sui Chuan’s personal capacity and do not in any way represent those of his employer and other related entities. 

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