As long-term fundamental investors with near three decades of experience, multiple cycles and 70+ years of combined investment experience, the team has witnessed many challenging moments. Before we dive into the challenges facing investors today, it is extremely important to stress the key investment pillars for us as investment professionals.
- Time in the market, not timing the market is most important to long-term wealth creation. Every cycle since the crash of 1929 has been followed by a strong recovery.
- Markets always exhibit either greed or fear. Last year we prepared portfolios for the coming fear and today, we scour the markets looking for great long-term investments while the market is fearful. We relish these opportunities; great businesses are coming closer to great prices.
- This too shall pass. We can show over the long term that markets are upward sloping. Inflation is real and we believe the equity market is the best hedge against inflation for patient long-term investors.
While we navigate these challenging times, we work to preserve capital for the next big uptrend, by investing in what we believe are the highest quality businesses with strong balance sheets, wide moats and proven business models and management teams. As we show in our commentary, some of the companies we own, benefit from the changing regime we have been discussing over the last year.
Lastly, the market for many recent years has been driven primarily by very large mega capitalization stocks. The market levels you hear or read about are not the entire market. We expect and have expected a divergence in outcomes for broad markets versus a collection of strong, well-priced companies, with excellent prospects for some time. Our job is to find them on behalf of our investors’ base as more and more opportunities are arising every day.
We welcome those of you who would like a more in-depth view into these comments to read the detailed report here: