Focus Plus

Invests in companies with larger market capitalizations. Subject to price, any publicly traded company with above average economics that is not small (as defined by the Russell 2000 Index) would be a potential investment in this portfolio. Typically, we will hold 7 to 14 companies. These are great (as opposed to only good) businesses selling at extremely compelling price to value ratios. This portfolio uses options to further reduce risk. We do not employ any leverage. Instead, we use options to sell volatility when it is expensive and buy volatility when it is cheap. We sell options which give us the right to buy or sell stock in companies at prices that we would buy or sell anyway. We are compensated with option premiums. Generally, we use options instead of buying stock directly when we can earn double digit returns from selling options. In rare circumstances we will purchase options. Always, the goal is to reduce risk.

Evaluating investment opportunities is a process; one we undertake with discipline and intentionality. Our primary objective is to minimize risk. We have always believed that by concentrating on not losing money, making money should take care of itself. We also analyze a company’s competitive strengths to ensure it meets our intended investment horizon of five years. Finally, we assess the human element, understanding that we are investing in real businesses run by real people facing real issues. We are not traders or speculators. We want to be long-term owners in a collection of superior business enterprises.

Learn more about our Investment Philosophy