We believe selecting investments is an entrepreneurial process, and our long-term record is possible because our approach and ideas do not reflect the "group" psychology of the investment community.
Every firm has its own philosophy of business, a set of principles that governs the way it conducts its affairs. This is most important in the investment counseling profession where knowledge, judgment, foresight and perspective are key ingredients to a successful and continuing relationship. We believe successful long-term investing is based on the growth of value made possible by economic expansion and corporate innovation, both of which are likely to continue.
The world economy will expand and advance in the future, as it has in the past. More goods and services will be needed to meet the ever-expanding world population. Higher demand will inevitably lead to advances in technology and research, creating new products, adding jobs, increasing productivity and building economic wealth.
Inflation will remain a key factor for all investors. The value of the dollar has declined for over fifty consecutive years. Even at 3% inflation, the value of the dollar will decline to 23 cents over an average investment lifetime of fifty years, and by one-fourth every ten years.
Perspective is important, and patience necessary, in achieving long-term investment success. We do not emphasize the short run, and we are unable to help those who follow an in-and-out trading approach.
We conduct our own independent research. We invest substantially each year to acquire outside expertise in the fields of economics, industry analysis, company research, taxation, law and political analysis. Government statistics and brokerage research are also drawn upon for input into our studies.
Our examination of investments is a fundamental analysis, and we are disciplined in our valuation judgments. Our recommendations reflect an assessment of both the underlying investment merits of a security as well as its value relative to its opportunities and risks.
We focus our efforts on those industries and companies that are capable of achieving above average results based on identifiable time-tested criteria.