Why should I choose Prudent Value?
Prudent Value specializes in value investing. Our mission is to preserve and increase the assets entrusted to us. Additionally, we endeavor to achieve above-average returns while accepting what we believe to be below-average risk. Our investment process centers on the work of Benjamin Graham and David Dodd (founders of modern securities analysis). We adhere to their philosophy that the better the bargain, the lower the risk. We believe following this way of thinking provides high yields and low risk. In addition, we follow Warren Buffett's approach to focus within our circle of competence. This discipline is important to us because investing is highly competitive, where misallocation of capital is seldom forgiven.
What is Prudent Value's investment strategy?
Prudent Value concentrates assets in its best ideas (subject to reasonable diversification) and generally maintains its investment positions for extended periods of time. With regard to individual stocks, shares are generally added to a portfolio when they (1) meet our criteria of a business comprising of favorable long-term economics, and (2) sell at a significant discount to our estimate of intrinsic business value. Companies are generally sold when their share price reaches our intrinsic value or higher. If no opportunities are available with a significant margin of safety, Prudent Value may invest in cash equivalents and/or fixed income securities. Additionally, Prudent Value may engage in risk arbitrage and other special situation transactions.
Why don't I just invest in mutual funds?
The advantage to using individual securities is that the portfolio is completely tax efficient (you never buy an unrealized capital gain). Further, you won�t be buying into an existing portfolio that may be fully or over valued. Another advantage is that you are not affected by other investors' redemptions. If investors in your mutual fund panic and sell shares, the fund manager may have to sell stocks at depressed prices to meet redemptions when the manager would prefer to be picking up bargains.
Do you have access to my funds?
No. Your portfolio is custodied through TD AMERITRADE Institutional, Division of TD AMERITRADE, Inc. Our clients grant us discretion to buy and sell securities in their account, but only the client can authorize funds in and out of their account. The securities in your account are protected and insured by the Securities Investor Protection Corporation (SIPC). For details, please visit www.sipc.org.
If I open an account with you can I transfer shares of other securities or mutual funds to the account?
Yes. We carefully analyze all assets before making any adjustments to a portfolio.
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