Wednesday, February 16, 2011

Compounding Machine

Value investing has the same definition but everyone chooses different stocks. The field is huge. But i like the concept of "Compounding Machine" brought about the manager of Akre Focus Fund
  1. have durable pricing power
  2. have real prospects for growth
  3. are not natural targets of regulation
  4. require only modest amounts of capital to operate efficiently
  5. are run by people of the highest integrity
  6. duplicate what happens at the company level at the per share level
  7. have an opportunity to reinvest all the excess profits at above average returns
This model of great businesses, great managers, and great reinvestment
opportunities has the potential to create a great “compounding machine”.

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