Conventional wisdom in the financial industry is that an “edge” (a systematic investing advantage) should be monetized through fee-based vehicles such as hedge funds or mutual funds. These strategies inherently produce conflicts of interest since the fees are asset-based, and therefore the business model becomes one of asset accumulation, i.e. marketing, instead of providing the best investment data and ideas, and long-term performance, for clients. It is a lot easier to double assets under management than to double annual return.

Napali Research is dedicated to the idea that the considerable research effort and data costs to produce high-quality investment analysis and screening can be made accessible to broad audiences of investors without the conflicts of interest inherent in a business model of asset accumulation. In many cases, straightforward data analysis quickly suggests effective strategies, some expected and some surprising.

And, finally, capitalism relies on capital flowing to its best use, and smart investing is exactly that: it puts capital to work with those teams that will do the best job with it. In this case, everybody wins, and hopefully Napali Research can play a small part.

News

Well-known investment author and columnist Hewitt Heiserman Jr. is publishing regular investment columns at www.TheStreet.Com’s RealMoney.com subscription site on Risk/Reward analysis using results of Napali Research custom screens.

Napali Research’s Founder

Napali Research’s founder, Dr. Michael Klein, combines 25 years of engineering experience in design and software tools with data-driven business analysis within the constraints of noisy and incomplete data. The result is an ultra-efficient software framework architected to overcome the difficulty of applying complex screens to large datasets and provide meaningful results with fast turnaround.

Dr. Klein’s professional career started in electrical engineering and computer science with degrees from Caltech (BS) and UC Berkeley (MS and PhD). He worked as an engineer and engineering manager in numerous Silicon Valley startup companies until 2004. He came to realize that many of today’s most difficult engineering problems involve managing complexity: complexity of data, of dependencies, of noise, of extremely large data sets.

In 2004 Dr. Klein began applying his analytical and complexity management skills to investing. A large part of the rationale was the commonality between managing complexity in engineering and complexity in business analysis.

Dr. Klein has been a contributor of screening strategies and results to investment discussion boards since 2003. The Motley Fool named him the 2006 Feste Award winner based on a popular vote of tens of thousands of board readers as best exemplifying The Motley Fool’s motto of “Learning Together.” He has provided many screening services over the years to help other investors find hidden opportunities specific to their skills and interests. Dr. Klein’s personal investment strategy is screen-based and uses the same tools and data as Napali Research employs.