Managing money is in essence the management of risk. The goal at hand is to create wealth at a rate of return that exceeds the rate of inflation by as much as possible while taking on the least amount of risk. We feel we can accomplish this goal by having a two-prong approach to investing money provided to us for investment management. The first is to be Value Investors by buying shares in individual businesses we feel can offer above average returns Vs the risk we would be taking. The second is to be aware of cycle and demographic trends that can affect the economies and stock markets of countries, sectors and businesses in which we are invested.
When we are seeking out individual companies that we feel offer investment value, we try to buy these companies at discounts to what we believe is their present value. We purchase shares in individual companies we feel we can understand. While we would like to be patient and long term holders of our investments, the current market environment calls for prudent entry and exit strategies of our holdings.
We also follow cycle and demographic trends that help us to be in the sectors and countries that make investment sense. Understanding what a country's population looks like in terms of the age of the people that make up a population is a key factor in telling if the economy in that country is likely to be strong or weak in the years ahead. Understanding S-Curves of market penetration of products and or services may also be telling of what type of growth or lack there of can be expected for certain industries.
Combining value investing with a keen sense of cycles and demographics, we feel we are armed with the knowledge and rational judgement of having a favorable risk reward balance in our portfolios.
For greater understanding of the complete Investment and Wealth Building Philosophy of Jason Tillberg, visit his other website, www.ValueInvestingClass.com.
