Windward will use its judgment and patience to build a portfolio of 15 to 20 good companies with understandable, sustainable, enduring business models, run by shareholder-oriented managements at fair prices that provide a margin of safety.
We look for investment ideas using a variety of resources, including Value Line, the daily highs and lows, and the financial press. We also observe the actions of investors whom we admire.
Once we identify a potential investment, we develop an investment case for a company. To gain understanding of a company and its industry, we typically look to its annual reports, managements shareholder letters, SEC filings, conference calls and other presentations. We may also talk with management, competition, customers, suppliers, industry experts – whoever might have valuable insights. The goal is to understand the key aspects of the companys industry, how the company creates value for its customers, how sustainable are its competitive advantages, and perhaps most importantly what can go wrong for the company in the future. If the investment case is compelling, we will quantitatively value the company, building in a margin of safety to give us some comfort should things not turn out as we predict.
We monitor our company developments for any changes to our investment theory. We will sell an investment if we have made a mistake in our theory, the company prospects deteriorate to make holding less attractive, or the shares become grossly overvalued.
Windward provides its services with rigor, candor, judgment and patience. We put our clients interests first. We demonstrate our commitment by eating our own cooking – we purchase and sell the same securities that we invest for our clients.
- Independent Advice
- Ownership of a handful of good businesses
- Long-term orientation which should result in low portfolio turnover, tax efficiency and low transaction costs
- Application of discipline should lead to superior risk adjusted investment performance over time
- Responsive customer service