How We Invest

Key Principles:

1. Co-investment.

I manage my own portfolio in the same way I manage money for clients. I “eat my own cooking.” Clients shouldn’t be exposed to investment risks that I wouldn’t willingly take myself.

2. Control costs.

Portfolios are constructed using individual stocks to express targeted investment views, alongside low-cost ETFs for diversification. Investment cost is one of the few things we can reliably control, and reducing fee drag improves prospective returns.

3. Risk management.

Business risk and price volatility are distinct. Stock prices fluctuate, but over time our returns ultimately depend on the performance of the companies we own and the prices we paid for them.

4. Asymmetric upside.

A growing business, held over many years, can multiply an investor’s capital several times over. I look for underpriced optionality: companies whose competitive position, profitability, or growth opportunities could improve more than the market expects.

5. Concentrate in the best ideas.

There isn’t an unlimited supply of attractive investments. When I find a compelling opportunity, I want to own enough of it to make a difference.

I concentrate individual stock positions in my best ideas (typically 8-12 stocks) while using other holdings to provide diversification according to each client’s needs.

The articles below explore these principles in greater detail.