The Strategy
Sustainable Growth
The strategy is based on the concept of value investing and is driven by an objective of sustainable growth. This type of strategy is designed to minimize the risk of sudden losses and to gradually, but surely, add value to the portfolio. It is a get rich slow approach, not a get rich quick approach.
The ultimate goal is future financial security and prosperity.
Value Investing
With a value investing strategy, we are looking for companies that are trading below their intrinsic value. This can be because they (or the entire sector) are simply overlooked, or that they are sitting on top of hidden assets, such as land or property, that will become valuable in the future.
This does not mean that we just look for cheap, obscure companies. Detailed analysis involves making sure the company is financially viable, has long-term prospects like a pipeline of viable projects or products, a sound strategy and a good management team.
The Portfolio
Right now, the portfolio is weighted towards banking, finance and real estate. There is a particular focus on UK companies, where there are currently some good value investing and dividend yielding opportunities. You will not find large positions in hyped-up growth stocks or crypto assets in this portfolio.
Positions are held for long periods of time and leverage is never used. The portfolio is gradually and carefully re-balanced over time, taking profits from large gains and re-investing into other opportunities to gradually compound our returns.
The Market
Yes, the stock market can be volatile and carries some risk. Deciding to invest in it is a courageous move, but it can be a very rewarding one. However, the vast majority of people will never invest in the markets themselves because they believe it is like gambling. This view is exacerbated by the media, which constantly reports on the daily movements of the global markets as if the world is ending.
Our strategy is very far from gambling. It ignores daily market fluctuations and focuses instead on finding pockets of genuine value and setting those against macro-economic factors like inflation. The long-term view of the portfolio smooths out the short-term volatility and reduces stress levels. We build wealth gradually, over time – not by responding to daily market swings.
And when should you invest? For the genuine, disciplined, long-term investor, the time to invest is always right now. History shows this very clearly. You could have entered the market at any time in the last 100 years, including right before any of the many market crashes, and still made plenty of money if you didn't panic and just let your investment alone. Waiting for the right time to invest just leaves your cash depreciating on the side-lines.