We abide by the famous quote from Warren Buffett: “the first rule of investing is not to lose money, the second rule is not to forget the first rule.” Our first and foremost objective is to minimizes as much as possible the chance of permanent loss of capital. After this goal is met, we aim to conservatively grow capital. We adhere absolutely to the value investing method, and will only invest in securities where there is a very high probability of the intrinsic value being more than the current market price.

 

In order to achieve this goal, we will look at certain areas for margin of safety investing.

1. We plan to invest in certain funds that have demonstrated long term success in capital allocation and investment. In certain situations, these funds are available at a significant discount to its intrinsic value. We will then plan to hold on to these investments for a very long time. With the low basis, we will obtain the benefit from both capital appreciation in the funds itself, and also the discount we brought the funds at. An example of such a firm is Berkshire Hathaway, which at certain times in history was available for less than its intrinsic value.

2. Specific securities, usually smaller, where the market might not have the time horizon for the long term investment, and that are misunderstood. We will only invest under a significant margin of safety.