Philosophy

VALUE INVESTING: The process of buying an asset at a price substantially below its estimated worth, to achieve the highest return on investment, consistent with preservation of capital.

VALUE INVESTING has produced exceptional results in the stock market since the early 1920s. Value investing is based on proven principles pioneered by the late Benjamin Graham and advanced by seasoned investors like Warren Buffett of Berkshire Hathaway Inc. Buffett, arguably the world's most successful stock market investor over the past 50 years, was Graham's most gifted student and a business partner.
   
"An investment operation is one which, upon thorough analysis, promises safety of principal and a satisfactory return. Operations not meeting these requirements are speculative."
Benjamin Graham, The Intelligent Investor, 1949, p. 1
 

SATISFACTORY INVESTMENT RETURNS. You earn high returns on invested capital by buying a small number of profitable, growing companies, at stock prices considerably below the value of their underlying businesses. Over time, your wealth increases as stock prices move up toward their rising business values.

PRESERVATION OF WEALTH. You preserve your invested capital by buying stocks of a diverse group of financially strong companies at bargain prices. The favorable difference between a stock’s current price and its estimated business value is called margin of safety. The safety margin minimizes risk, which is the possibility of permanent capital losses.

   

 

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