INVESTMENT PHILOSOPHY
Our investment philosophy has been shaped by studying what was worked in investing over the long run and examining the principles espoused by many of the world’s greatest investors who have successful long term records of allocating investment capital effectively.
Kinnell & Co takes a strategic approach to allocating investment capital based on what has worked best for investing client capital for decades and that is a value investment philosophy. We seek to construct adequately diversified portfolios, containing high quality assets, purchased below their assessed intrinsic value.
Whether we own the bonds or stock of a company the durability of the underlying businesses, along with the price paid for each asset, are critical to successful investing over the long run. Our approach requires discipline and patience.
We look for the following characteristics when selecting a business to allocate capital to:
1. A simple and understandable business model.
2. A business that is unlikely to become obsolete.
3. A durable competitive advantage – a ‘moat’.
4. Logical growth opportunities.
5. A suitable return on shareholders’ equity.
6. Strong free cash flows.
7. Low levels of debt finance – a resilient balance sheet.
8. A consistent and profitable operating history.
9. Rational, honest, and shareholder orientated management.
10. Priced below intrinsic value to achieve a margin of safety.
“We don’t have to be smarter than the rest. We have to be more disciplined than the rest.”
– Warren Buffett
Kinnell and Co Board
Kinnell and Co holds quarterly board meeting covering all aspects of the business to ensure that high standards of governance and process are maintained at all times.