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"An investment operation is one which, upon thorough analysis promises safety of principal and an adequate return. Operations not meeting these requirements are speculative.”
- Graham & Dodd "Security Analysis" 1934.
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We are value investors. There is significant academic and empirical research confirming the long term outperformance of value investing. We have followed a disciplined value approach for more than 20 years. We strongly believe that markets are inherently inefficient, and that by taking a long term view, we can take advantage of inevitable periods of excess pessimism by buying when valuations are depressed and by selling when valuations become extended during periods of excess optimism. Consequently our actions are often contrary to prevailing market behaviour.
We are bottom-up investors. Portfolio construction is driven by selecting stocks based on detailed company analysis and estimates prepared by our investment staff. All investment professionals are analysts, including our Chief Investment Officer. Researching and identifying attractive long term investments for clients is what we are most passionate about. This is where the bulk of our investment efforts are focussed.
We are long term investors. We invest our clients’ money with a minimum investment horizon of four years, as we recognize the importance of compound capital and income growth and the difficulty in timing markets. The best opportunities are found by taking advantage of the markets’ inherent short term focus when there are no apparent catalysts. Such opportunities can only be captured by our clients affording us a genuine long term perspective. Where appropriate, we will also ensure our clients' interests are maximised on both a post and pre-tax basis.
We are conservative investors. We define risk as the spectre of losing our clients’ money rather than simply underperforming our peers over an arbitrary (and often short term) period. Our attention is placed on understanding the inherent risk of the companies we invest in through a detailed analysis of balance sheets and by reconciling reported profits to underlying cash flow.
We are consistent investors. As a privately owned and independent company we will continue to invest our clients’ money according to the disciplined long term approach outlined above without exception. Since the firm's beginning in 1984, we have witnessed many different and often dramatic market events and remain passionately committed to long term bottom-up stock picking.
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