You learn quickly in this business that you're not going to look smart all the time, which inevitably brings criticism. We always remind ourselves of that great Jean- Marie Eveillard quote, “I'd rather lose clients than lose clients' money.”
We break the world into geographic regions, but within those regions we want our analysts to be generalists looking across all industries. Part of that is so people can apply a broad knowledge of business models, industries and markets to every company they analyze. It also allows people to more naturally gravitate to where the [...]
One important aspect of business quality is how successful it will be in a lessbuoyant economic period. Can they cut costs? Can they take market share? Will their balance sheet an asset? The answer to those questions can make a huge difference in the viability of any investment.
People tend to lump international investing into this general bucket of opportunity, which to us is kind of silly. We expect a closing of the relative GDP-per-capita gap between the developed world and many emerging markets, but as that happens we believe you’re still going to have stocks be cheap or expensive based on cyclical [...]
We expect to generate the vast majority of our returns not from the growth in the value of the business, but from the unwinding of the value discount. We're more than happy to see growth potential and we recognize how valuable it can be, but higher-growth businesses typically expose us to more valuation risk than [...]