Investment Philosophy


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  • We invest client assets with as much focus, care and attention as we do our own.
  • We “eat our own cooking” by investing our own money in many of the same securities as those owned by our clients, but always putting their interest first when trading.
  • We endeavor to seek out undervalued securities with a margin of safety and remain patient enough to give them time to work. 
  • We endeavor to invest in securities possessing positive financial characteristics that tilt the odds of success in clients’ favor, rather than in Wall Street’s favor.
  • We select clients’ investments based on value, not by convention or popularity.  
  • We worry about the risk of permanent rather than short-term quotational loss of capital.   
  • With respect to individual stocks, we shop for values in all market segments, without letting artificial categories like big-cap, mid-cap or small-cap hinder us--we go where investment bargains or opportunities manifest themselves.
  • We spend a lot of time developing variant or contrarian views of potentially rewarding investments, whose attractive entry prices are created by the difference between our long-term view and the prevailing short-term consensus of Wall Street and the general public.
  • With respect to individual equities, we endeavor to diversify, but not over-diversify; with respect to mutual funds, we leave it to the fund managers to achieve diversification, unless the fund is designed to be non-diversified.
  • We regard clients’ investments as diversified ownership interests in real businesses, and not lottery tickets that are to be traded based on hunches, speculation or market fluctuations.
  • We manage clients’ assets using valuation techniques, and avoid trying to game crowd psychology by buying high and hoping to sell higher because of momentum (a.k.a. the “Greater Fool’s Theory” of investing).
  • We are mindful that we are all fallible in predicting the future, and refrain from believing we can time the market or game crowd behavior effectively; many have tried, but none has ever succeeded on a consistent basis.
  • We endeavor to analyze what the normalized earning power of a potential investment might be.  
  • We generally sell equity positions under one of four circumstances:  a) the stock has become grossly overvalued, b) after taking tax and transaction cost considerations into account, a much more compelling investment comes along, c) subsequent events following our stock purchase have demonstrated an unexpected and likely permanent deterioration in business value that does not appear to be adequately discounted by the current stock price, or d) the stock has become too large a position (generally defined as over 10% of the assets under management).



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