I grew up in a city roughly halfway between Seattle and Tacoma where much of the population is toward the low socioeconomic standing. Spending grades K-12 in the public school district that was not the worst, but certainly not the best. Learning has always come naturally, so I was never pressured to give my education much (if any) thought until the summer before starting my sophomore year of high school.
The next few years were the most agonizing and the influential of my life. A turbulent divorce left my mom working two jobs and forced an involuntary maturation process. This was a catalyst that brought me to focus on my education and put me in a position to succeed that I would not otherwise be in. I have two younger …show more content…
Position weightings and the cash position are subject to significant changes.
• Valuation: Implied business value is calculated through an evaluation of three different hypothetical narratives. Evaluating the preliminary scenario (base case) first, the other two would follow and look to represent conservative depictions of the business should it outperform (upside case) or underperform (downside case) the original valuation of the business. Taking these three values into account, shares are assigned a valuation range.
• Margin of Safety: There is no escaping the reality of a poor investment, but purchasing shares where they would the implied upside is no lower than 15% for large cap names and 20% for anything smaller.
• Re-evaluation: I’ve learned on a number of occasions that it is important to look at risk, when it presents itself, from top-down perspective. Positions that appreciate toward the bottom end of my valuation range require a reassessment of the validity of the original thesis. My goal is to establish long-term positions, but the decision to sell or reduce a position should be made without consideration of a time