Risk can’t be reduced a number. Our analysis is qualitative and in-depth. Before we recommend an investment to our clients, the company must pass each of the 7 Punch Card Principles.
Technology is unlikely to render the products and services obsolete.
The company is unlikely to succumb to the forces of competition.
Future growth is based on reasonable assumptions and is value enhancing.
Management can be trusted to wisely manage the excess cash generated by the business.
The price per share provides an adequate margin for safety.
The business model is proven and time-tested.
Most importantly: Are we willing and eager to put 25% of your own net worth into this company for the next ten years, even if the market were closed that entire time?