Strategies

Strategies

We believe in focused investing because the universe of pioneering enterprises with profitable business models is always quite small.  Our typical managed portfolios are concentrated in ten to fifteen specific holdings.

We believe in a fundamental understanding of each of our portfolio companies.  We place significant emphasis on understanding the value-added service or product offering of each company.  We endeavor to recast the income statements of each company to determine their ‘real’ economic earnings.  We specifically embrace companies with meaningful ownership by founders and management.

We are long-term investors with a median holding period of more than three years.  Within the subset of our most successful holdings, we rarely do more than periodically trim our positions in order to fully benefit from their entrepreneurial success.  Most of our modest turnover involves recognizing errors in fundamental analysis.

Our portfolios are tax-efficient because we defer most of our portfolio gains for many years.  In addition, most of our realized returns are in the form of tax-advantaged dividends and long-term capital gains.

Because we invest in younger companies, we accept the reality of significant short-term market value fluctuations.  Our focus is on controlling risk by understanding company fundamentals.

In order to better serve many of our clients, we will also oversee ‘monitored’ portfolios of no-load mutual funds, existing low-cost basis equities, high quality debt securities, and cash equivalents.