What to Expect


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  • We will invest your assets with as much focus, care and attention as we do our own.
  • We are not, nor do we seek to be, all things to all people.  We are best able to serve patient clients interested in prudent wealth accumulation over time, but with realistic expectations as to how long it will take to get there and that there will be some inevitable bumps and detours along the way. 
  • We will be passionate about what we do and how we do it, and dedicated and committed to helping you reach your financial goals; we will be independent in our thinking and investment approach.
  • Our investment strategy is based on long-term rational thinking--it’s unlikely to produce the desired results in the short run, when powerful psychological forces of fear and greed suppress rational thinking from the market.
  • We will not let possible criticism or embarrassment that might come from our investing in a non-conventional way deter us from doing what we believe is beneficial to you in the long run.
  • Our competitive edge is in making valuation decisions that tend to have beneficial long-term benefits and in exercising patience and discipline, not in timing the market.
  • Valuation is a risk-evaluation tool, not a market-timing device; we will not know when value and price will ultimately converge, though we seek a large enough discount to make the wait generally worth your while.  
  • There will be periods of market weakness, which you should welcome as they afford the opportunity for the long-term, patient investor to sow the seeds for future wealth accumulation via lower bargain entry prices.
  • Generally speaking, your portfolio is unlikely to soar during roaring bull markets when caution is abandoned by the investment masses (as we are unwilling to chase momentum stocks with absurd valuations and huge embedded risks--these are the ones most likely to move up the fastest during speculative periods); generally, we are likely to do relatively better in weak markets, when our rationality and risk management focus are more recognized and valued by the market.
  • You will have some down quarters and years for your portfolio--nobody is infallible when it comes to investing, especially in the short run which is subject to the vagaries of the market; the valuation of your overall portfolio will dictate whether you will likely have a strong or more lackluster period ahead.  
  • We will rather sell overvalued investments at a gain and cause you to pay taxes, than give back gains by sitting on overvalued investments so you have no taxes to pay.
  • We will define risk of an investment by analyzing its odds of success as evidenced by its financial characteristics rather than the volatility of its stock price. 
  • We will not participate in the short-term performance “rat race” with your money, by taking imprudent risks in chasing momentum to look good in the short run, only to have you pay in the long run--we are prepared to sacrifice short-term gratification to achieve longer-term benefits for you; this may make us look out-of-touch or foolish in how we invest for you initially, but eventually we expect many of our decisions will likely be vindicated over time.
  • We will seldom, if ever, be able to sell a stock at its high or buy it at its low; any ability to do so from time to time will be due purely to luck.   
  • Out of every 10 investment decisions we make on your behalf, our goal is to get at least 7 of them correct over time; this goal appears consistent with what other successful investment managers are able to achieve; there will inevitably be losers in your account, and it is our goal to keep them to a minimum.
  • Any investments that we are interested in will tend to have temporary operating issues that have produced excessive pessimism, unduly depressing their stock price; such investments tend to be out-of-favor and unpopular with the media, other investment managers, your friends, neighbors, relatives and colleagues.   Don’t be surprised if you get ribbing from them about these investments.  However, it is our goal to let you have the last laugh in due course, as the benefits of such investments have the opportunity to become apparent over time.

 

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