Experience and conviction. Experience and conviction in one's ability to analyze and value companies are vital to the success of concentrated value investors who often take positions in unpopular, out-of-favor companies. It is this willingness to act unconventionally that provides compelling investment opportunities. FI's Principals have spent their entire investing careers learning to think and act unconventionally in seeking out superior investment ideas. In addition, they can draw upon the 30+ years of investment experience of James Gipson, FI's Senior Advisor.
Disciplined approach. FI adheres to a strict discipline of concentrated value investing by constructing portfolios of 15-25 significantly undervalued companies. Only companies priced to provide at least a 20-40% margin of safety are eligible for inclusion in the portfolio with the most undervalued companies commanding the largest positions. Positions are sold when their share prices reach 100% of intrinsic value. Strict adherence to a disciplined investing approach increases the odds of investment success.
Long-term orientation. Successful investing requires a willingness to look beyond the short-term issues that affect stock prices and focus on the longer-term issues that determine business value. By investing with a 3-5 year timeframe, FI largely ignores short-term investor concerns and focuses instead on issues that lend themselves to rational investment analysis (such as a company's competitive position, future cash flows, capital allocation, etc.). Our long-term orientation also allows us to participate in the inherent growth in value that accrues to high quality companies over time thereby reducing portfolio turnover and increasing tax efficiency.
Partnership with clients. We are partners with our clients. FI's Principals have invested a significant portion of their liquid net worth in the Firm's investment product. While we cannot guarantee our investment results, we can guarantee that our financial interests are aligned with those of our clients.
Pursuing our passion. Investing is our passion. We truly enjoy what we do each and every day. We feel tremendous satisfaction in finding great investment ideas (and even more enjoyment in profiting from them).