Guiding Principles

Our approach to managing portfolios is driven by our beliefs about how the markets work and by our skill set as an investment team:

  • Bottom up stock selection provides us with the best opportunity to generate consistent excess returns.
  • We analyze and value stocks as partial interests in businesses, and our investment time horizon reflects this mindset.
  • We are value investors, but we do not focus on low expectation businesses. Investment flexibility within a manager’s area of competence is better than focusing on strict style conformity.
  • We will not own a stock if we cannot effectively value the company within an acceptable confidence range.
  • Digging deep into company fundamentals is important. However, it is crucial that we understand the 3 or 4 factors that will “move the dial” over time, how the market is currently pricing the stock, and where our insights differ from consensus.
  • Good businesses deliver consistent growth of intrinsic value over time. Discounted valuations provide downside protection and add to return as the valuation gap narrows.
  • Investing in good businesses at discounted prices is a simple concept but a highly effective approach. While no strategy works in all markets, behavioral finance factors and market noise keep this methodology robust.