“The performance of investors who add value is asymmetrical. The percentage of the market’s gain they capture is higher than the percentage of loss they suffer …. Only skill can be counted on to add more in propitious environments than
The start of a new year is an excellent time to take stock of past accomplishments and chart a course for success in the future. As value investors, we attempt to identify securities trading at a discount to intrinsic value that can be purchased with a substantial margin of safety. When an investor purchases a security, by definition he or she is expecting to earn returns greater than the overall market over the anticipated holding period. Otherwise, there is no point in going through the effort of security analysis when ultra low cost index funds are available to implement a passive strategy. Read this article for more details.