A Story of Perseverance and Success===

Marty Whitman was a legendary investor who founded Third Avenue Management and pioneered the value investing approach. He passed away in 2018, leaving behind a legacy of wisdom and inspiration for aspiring investors. Whitman’s life was a story of perseverance and success, characterized by his humble beginnings, Ivy League education, and Wall Street journey. He faced many challenges, including the dot-com bubble and the Great Recession, but he stayed true to his principles and emerged as a contrarian hero. This article explores the life and times of Marty Whitman, from his early years to his enduring legacy.

Early Life: From Humble Beginnings to Ivy League Education

Marty Whitman was born in New York City in 1924 to a Jewish family that had emigrated from Poland. His father was a garment worker, and his mother was a homemaker. Despite their modest means, they encouraged their son to pursue education and excellence. Whitman attended Brooklyn College and earned a degree in accounting. He then went on to study at New York University’s Graduate School of Business Administration, where he earned an MBA in finance. These degrees would prove to be critical in his future career as an investor.

Wall Street Beginnings: A Young Analyst’s Journey

After finishing his education, Marty Whitman started his career as a securities analyst at Shearson Hammill & Co. in 1950. He then worked for several other firms, including Lehman Brothers and the now-defunct Loeb Rhoades & Co. During this time, he developed his contrarian approach to investing, which focused on finding undervalued stocks that the market had overlooked. He also gained a reputation for being a hardworking and independent thinker who was not afraid to go against the consensus.

Third Avenue Management: The Birth of a Value Investing Legend

In 1986, Marty Whitman founded Third Avenue Management, a mutual fund company that specialized in value investing. He saw an opportunity to offer investors a different approach from the mainstream Wall Street firms, which focused on growth and momentum stocks. Whitman believed that value investing offered a more sustainable and profitable way to invest, based on analyzing a company’s fundamentals and intrinsic value. Third Avenue Management became one of the most successful mutual fund companies, with assets under management reaching more than $25 billion at its peak.

A Contrarian Approach: Marty Whitman’s Investment Philosophy

Marty Whitman’s investment philosophy was based on the principles of value investing, as pioneered by Benjamin Graham and his disciple Warren Buffett. Whitman believed that the stock market was often irrational and inefficient, and that there were many opportunities to find undervalued companies that the market had overlooked or misunderstood. He also believed in doing extensive research and analysis on a company’s financial statements, management, and competitive position. He was not afraid to invest in companies that were out of favor, distressed, or underappreciated, as long as he saw a long-term value proposition.

The Dot-Com Bubble: How Marty Whitman Stayed True to His Principles

During the late 1990s and early 2000s, the dot-com bubble swept through the stock market, with many technology companies seeing their valuations soar to unsustainable levels. Marty Whitman saw this as an opportunity to stay true to his contrarian approach and avoid the hype. He refused to invest in many of the high-flying tech companies, such as Amazon, Google, and Yahoo, that were the darlings of Wall Street. Instead, he focused on finding undervalued companies in other sectors, such as real estate, manufacturing, and retail. This approach proved to be prescient, as the dot-com bubble eventually burst, and many of the tech companies that had soared in value during the bubble went bankrupt.

The Great Recession: A Test of Marty Whitman’s Resilience

In 2008, the Great Recession hit the global economy, and the stock market experienced a severe downturn. This was a challenging time for investors, as many companies saw their valuations plummet, and the financial system was on the brink of collapse. Marty Whitman saw this as another opportunity to stay true to his principles and invest in undervalued companies that had strong fundamentals and competitive advantages. He also used his decades of experience to make strategic moves, such as buying distressed debt and taking activist positions in companies that he saw as undervalued. Thanks to his resilience and contrarian approach, Third Avenue Management weathered the storm and emerged stronger than ever.

Legacy: Marty Whitman’s Impact on the Investment World

Marty Whitman’s impact on the investment world cannot be overstated. He was a pioneer of value investing and a contrarian hero who inspired many other investors to follow in his footsteps. His approach to investing was based on sound principles and a long-term perspective, which enabled him to achieve consistent returns for his clients over many decades. He also developed a reputation for being a mentor and a leader, who was always willing to share his knowledge and insights with others.

Lessons from Marty Whitman: Wisdom for Aspiring Investors

Aspiring investors can learn many valuable lessons from Marty Whitman’s life and career. One of the most important lessons is the importance of perseverance and resilience, even in the face of adversity. Whitman faced many challenges throughout his career, from market downturns to personal setbacks, but he always stayed true to his principles and kept moving forward. Another lesson is the value of independent thinking and contrarianism, which can help investors avoid the pitfalls of groupthink and herd mentality. Finally, Marty Whitman’s focus on value investing and fundamental analysis is a timeless lesson that can help investors identify undervalued companies and achieve long-term success.

Memories of Marty Whitman: Tributes from Colleagues and Friends

Marty Whitman was known for being a mentor and a friend to many people in the investment community. He inspired and influenced many others through his words and deeds. After his passing in 2018, many of his colleagues and friends paid tribute to him, highlighting his unique qualities and contributions. One of his former colleagues, Ian Lapey, said, “Marty was a true leader who set the standard for value investing. He was a kind and generous mentor who inspired many people to follow in his footsteps.” Another colleague, Bruce Greenwald, said, “Marty was a true contrarian who always saw the value in things that others overlooked. He was a brilliant investor and a great human being.”

Marty Whitman’s Final Years: A Life Well-Lived

Marty Whitman passed away in September 2018, at the age of 93. His final years were a reflection of a life well-lived, characterized by his passion for investing, his dedication to his family, and his generosity to others. Despite his age and declining health, he continued to be active in the investment community and to share his wisdom with others. He also remained committed to his philanthropic causes, such as the Marty Whitman Charitable Trust, which supports education, healthcare, and the arts.

Conclusion: Marty Whitman’s Enduring Legacy

In conclusion, Marty Whitman was a legendary investor who left an enduring legacy in the investment world. He was a contrarian hero who stayed true to his principles and achieved consistent returns for his clients over many decades. He was also a mentor and a friend to many people, who inspired and influenced them with his wisdom and insight. Marty Whitman’s legacy will continue to inspire and guide aspiring investors for generations to come. As he once said, “The only thing worth doing is good investing, and the only way to do that is to think for yourself.”