Michael Sprung must have been both the shyest and smartest kid in class. You know, the kid who coasted through school with A-pluses without much effort. Well, Michael would go on to study actuarial science, which — based on what it takes to grasp and fulfill the curriculum — is right up there with rocket science as far as I’m concerned. After that he obtained an MBA and then qualified as a CFA. Today, Michael is still relatively shy. He looks exactly how you might expect an actuary to look: white shirt, black slacks, black shoes, and tidy white hair. The thick lenses of his glasses enlarge his eyes. He is soft-spoken. Our interview starts slowly, but Michael opens up as he gets more comfortable with me and the format. The more he talks about investing, the more he comes to life.
Investing happened to be Michael’s calling. He could have very well become a salaried actuary employee at an insurance company, tucked away into a neat little cubicle. Instead, he founded Sprung Asset Management, and as Sprung’s president, Michael’s got lots of interesting stories, insights, and forecasts on investing in the market. Reading the transcript of our interview later, I realized that of all the interviews I had conducted, his transcript was the most cohesive and succinct in its raw form. Michael is a man who thinks clearly and articulately, and who speaks the same way.
Michael Sprung is a student of value investing. Michael’s “school” was his first employer, Confederation Life, where he learned value investing and worked under value managers who would go on to storied careers of their own. “Anyone who went to Confederation Life would consider themselves value investors today,” said Michael during our meeting. Michael and I met in a small, spare meeting room. We pulled our chairs up close and then began with the click of the red button on my recorder.
CFA: Chartered Financial Analyst (an official accreditation).
Conglomerate: a large company that contains an expansive and diverse set of businesses (e.g., Berkshire Hathaway).
Conservative Investing: an approach in which investors make safe investments in the market.
Large-cap Stock: a public company that usually has a market capitalization over $10 billion.
Mid-cap Stock: a public company that usually has a market capitalization of between $2 billion and $10 billion.
Risk Management: when an investor implements controls in his or her trading or investing practice that protect the downside in order to preserve capital.
Small-cap Stock: a public company that usually has a market capitalization of between $50 million and $2 billion.
Watch list: a list of stocks that an investor creates to monitor, and possibly invest in, in the future.
Weighting: the percentage of capital that you allocate to each of your investments (stocks, bonds, etc.).