No. of Recommendations: 4

Here is a bit more information on my fund.

Long-term capital growth that outperforms the Wilshire 5000 (or broad value index).

Investment Strategy
The fund employs a value style and seeks to buy high-quality equities at a discount to their true worth. It will attempt to minimize risk of capital loss to the greatest extent possible through low purchase prices, astute judgments of business value, and other factors such as dividends. The fund invests in stocks with low price-to-book ratios, low P/E ratios, or other traditional value measures but isn’t constrained by these metrics.

The fund holds 20-30 positions with a typical time horizon of 2-5 years. The fund invests in stocks of all sizes above a $100 million market capitalization. The fund invests in foreign markets and foreign stocks could make up any percentage of the fund’s holdings. The fund only invests when it finds opportunities that meet its return criteria and may hold large cash positions to wait for better opportunities.

Investment Methodology
The Fund evaluates investments on a company-by-company basis. It attempts to find businesses with a sustainable competitive advantage priced at a discount to their true worth. Other criteria include strong free cash generation and management that is shareholder-friendly and that can allocate capital well. The combination of high-quality businesses, good management teams, and low prices should minimize the risk of capital loss.

General Market Risk
The fund is exposed to general market risk, where short term market fluctuations could reduce the value of the portfolio.

Non-Correlation Risk
No effort will be made to mimic the sector weightings of the Wilshire 5000, S&P 500, or other market indices, so returns could differ from broad indexes or even value-based indexes.

Value Style Risk
The fund could underperform due to risks associated with the value style, namely that the market will continue to assign a low value to stocks that the manager thinks deserve a higher value.

Manager Risk
The fund could underperform due to poor decisions by the manager.

Currency Risk
Since the fund will not hedge its foreign currencies, it will be exposed to currency risk in its international investments.

Manager Performance & Benchmarks
The manager expects to be judged by his performance against both the market and a broad value-based index, such as the one maintained by Fama & French.

Historical Value Returns
Value-based investment strategies have outperformed growth by 2-4% annually according to various studies. From 1927 to 2007, value stocks outperformed growth stocks by an average of 4.3 percentage points according to Eugene Fama & Kenneth French. From 1969-2002, value stocks outperformed growth stocks by 2.2 percentage points (11% for value, 8.8% for growth).

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