We have three people in charge of the portfolio and we require unanimity on a stock in order to buy. But it's majority rules on selling. The fact is that it's very hard to sell one of your ideas, especially when it's working beautifully. In those cases, it's often been helpful to have the two [...]
If an individual position decreases by 10 percent from our cost, we conduct a formal review. The focus is on understanding why something has gone down. If the reason is that the sector is down, or pessimism over a short-term trend has increased, we'll typically buy more if we believe the story is still intact. [...]
We have three people in charge of the portfolio and we require unanimity on a stock in order to buy. That's not to say we have to feel equally strongly about something, but a great thing about having different intuition is that we're less apt to skim over something important because we're looking at things [...]
We firmly believe no investment is so wonderful that it can't be ruined by a too-high entry price, so on our discount-to-cash-flow stocks we will not pay more than the market multiple on forward earnings. We want to avoid the temptation of making relative valuation bets say, finding a software company attractive because it's only [...]
We like being generalists. We haven't owned any healthcare for more than a year, but nobody feels like they have to push healthcare ideas, or that their bonus is threatened, because they're the person focused on healthcare. Ideas rise to the top only on their merits.