Jonathan Davis

INVESTMENT SPECIAL: This time he’s playing for keeps

For the outspoken Terry Smith, successful investing means never having to say ‘sell’

For the outspoken Terry Smith, successful investing means never having to say ‘sell’

Terry Smith’s office is high up in Tower 42, formerly the NatWest tower, in Old Broad Street. It has a sweeping view over Docklands towards Essex, the neck of the woods with which he seems to be associated in the popular mind. This high-profile City figure’s image is that of a bruiser with attitude, who made good in the money markets through a series of ballsy deals and likes nothing better than a good scrap.

On his new blog, Straight Talking, you can read his denunciations of Labour spending and the ‘myths’ about Osborne’s cuts, particularly as reported by the BBC. While Smith wins friends and enemies in equal numbers with his forthright opinions, his saving grace in the financial markets is that he does not flinch from facing reality. He first made his name in the 1980s as the only banking analyst in London who dared put out a sell note on his own employer’s shares, and then wrote a book which exposed the accounting sleight of hand employed by some of his next employer’s best clients. Unsurprisingly that got him the sack, but it proved to be the making of his career.

Twenty-five years on, he turns out to be a trim, genial bloke in his fifties who bears more than a passing resemblance to the comedian Frank Skinner, but talks at about three times the speed. We meet shortly after the publication of Warren Buffett’s latest annual letter to his shareholders: Smith is a long-standing fan, and has modelled his latest venture, Fundsmith, on many of the principles which Buffett has espoused in his even longer career as professional investor and wiseacre. ‘I’ve been reading his letter since 1980 and one of the things I’ve noticed is that it’s easier to be humorous the richer you become.

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