Jason,

Thank you for your response. Melding right- and left-brained techniques is still a work in progress for me. I look forward to your next article, because there are some nuances (similar to the one you addressed above) that really help to flesh out the overall intuitive framework/model.

As for early intuitive experiences, and specifically within an investing context: a couple of years ago I was analyzing a mid-cap technology company. There was a lot that I liked about it from a purely financial perspective - its bread-and-butter products were patent-protected, the technology was proprietary, they earned 90%+ gross margins (essentially a royalty business), and capital required to expand the business was absurdly minimal. To boot, insiders owned a significant chunk (20%+) of the company's shares.

But as an individual investor, it was difficult to get access to top management. I could read what was said at investor presentations/conferences, quarterly earnings calls, and press releases, but as most investors know, that language is so doctored and carefully crafted that it is nearly impossible to draw any conclusions about the actual character of the people running the business.

I had read through the company's most recent annual report, 10-Q, and a couple years worth of conference calls, and finished my financial modeling. At this point everything still looked very good, and I was ready to put money to work.

To make sure all of my due diligence was in order, I read through the proxy. Proxies are typically filled with a lot of boiler plate about executive compensation, biographies of directors, etc. But there was one paragraph detailing a host of intra-company transactions between the chairman (who was the founder and a significant shareholder) and the company. Most significantly, the chairman owned the building in which the company was headquartered, and leased it out on what I considered to be onerous terms.

While the financial impact was slight in the context of the overall business, the one thought that crystallized for me was: this person is running the business for their own aggrandizement, and it would be foolish to trust my money with them.

A very difficult situation for me to walk away from given that my left brain was screaming, "BUY!" I've tracked the company's performance in the interim, and while the company's stock has done well on an absolute basis (up ~35%), it's lagged the S&P 500 by about 12 percentage points. Financial results have been more or less stable, and the growth that I had been expecting - and that management had been guiding to - didn't materialize.

So out of tens of thousands of words read, many hours spent, etc., a few dozen seemingly innocuous words turned a surefire "yes" to a "no," based solely on my intuitive sense for top management. And it helped to guide me away from an investment that ultimately has not generated any alpha in the last few years.

An early but rudimentary experience with the power of intuition that has stuck with me ever since.