In the Forever strategy,
Sam seeks to own high quality businesses for the long term.
Forever stays true to its name by investing in companies
that we believe can be held essentially forever.
In a nutshell,
this strategy is a collection of what we believe are the world's
greatest businesses today and importantly will stay that way tomorrow.
There are certain attributes we find in the
world's very best companies and so naturally they
are represented throughout the forever portfolio.
One of the most important attributes
is a durable competitive advantage.
That advantage could come in a number of ways.
It could be a dominant brand,
a superior distribution network,
or some other hard to replicate factor.
What matters is that this durable competitive
advantage insulates the company from competition and
allowing the company to be a competitive advantage.
allows it to grow for many years to come.
Another key attribute is capital efficiency.
Companies with this trait can grow their sales and earnings
without needing to invest too heavily back into their business.
As a result,
these companies tend to generate better returns on their
investment and have more cash to pay out to their
shareholders in the form of share repurchases and dividends.
We don't manage forever with tax efficiency as our primary goal.
However, it is a nice byproduct of strategy.
However, it is a nice byproduct of the strategy.
Here's what I mean.
We're investing in the world's greatest businesses,
companies with durable competitive advantages.
And so as long as they stay that way and their
share prices don't get too detached from reality,
we'll continue to own them and allow them to compound
their earnings and our portfolio returns year after year.
Thus,
the end result is that in a typical year,
we do not realize a lot of gains.
Investing in great companies over the
long term is almost always a good idea.
However, this strategy isn't for everyone.
You should have a suitable time horizon
for this strategy's long term focus.
And as the priority is growth,
you should be comfortable owning an equity
driven portfolio throughout a market cycle,
as this strategy may carry more risk.
If that sounds like you,
then forever could be an excellent way
for you to grow your investment portfolio.
