I predicted negative oil prices in April 2020 — and from the data I have seen I was one of only a handful of investors to do so. Some people reached out to me and asked whether I am a dedicated short seller or a specialist in commodities or futures trading. My answer is NO!

I did not make that negative-oil prediction because I wanted to short something, nor because I wanted to do something global macro. I made that prediction because I study fundamentals. I think in “first principles,” which leads me to focus on the fundamental truth of a thing — and in this case, the supply and demand of crude oil, a study which eventually led me to conclude there would be a severe surplus of oil supply and the world would run out of storage space for crude oil, thus we would see negative oil prices.

Ironically, if I were someone who works in the oil & gas industry, or someone who works for a global macro hedge fund, I might never have been able to make that negative-oil call. Conventional wisdom would judge that I don’t have the “right” background to form a “right” opinion on crude oil prices. Even until today, I have never seen a barrel of crude oil with my own eyes. Yet it was exactly my unconventional background — zero oil & gas industry experience, in particular — that enabled me to see things in a new and different light, eventually arriving at that very unconventional prediction.

Weird, is it? Why almost no industry experts nor investment specialists saw the negative-oil coming?

Let us zoom out a little bit.

Let us look at the investment industry as a whole.

The investment industry attracts some of the most talented people on earth. The talent pipeline of this industry is filled with golden resumes: finance undergraduate from a prestige college, investment banking analyst program, buyside analyst/associate, MBA from a top-tier b-school, then an elite job at a hedge fund or PE/VC — in other words, exactly what most hedge funds look for in their recruits.

That path is the “right” path, the path that offers the highest probability of “getting there.” More and more people take it. It is the conventional path. Why not? As time goes by, the talent pool overruns with people sharing all too similar backgrounds.

Eventually, the investment industry reached a point where the reality becomes inconveniently awkward: there are so many of them doing the same thing and the market is too competitive for any one of them to win!

Not because they are not good enough. But because they are too much alike. They imitate. They become conventional.

Imitation doesn’t work in investing. Investing is a people business. People are not machines. The market is dynamic. The market learns. What works today probably will not work tomorrow.

That is why the greatest investors usually come with unconventional backgrounds: some are self-taught; some have zero investing experience before launching their own funds; some only entered the investment industry after spending years doing something totally unrelated.

So, I believe today’s market is won by unconventional investors. Because they are already so far behind at the start, they must run faster, run longer and run smarter! They know either they become the best or they get nothing! They have no choice. Because they do not have the “right” background, they must work harder and be more creative.

Because I don’t have a background in oil & gas, I had no choice but to ask myself the most basic and most fundamental question — how was the supply and demand of the world’s oil market? Because I am unconventional, I asked the right question, which led me to the right answer.

And that is why, I believe, the trophy of investing belongs to the unconventional players.

Imitation doesn’t work in investing. It brings nothing but mediocrity. Be unconventional. Unconventional success calls for unconventional people.