Investments For Business-Savvy Investors (Guest article)
An entrepreneurial approach
An investment philosophy for business-savvy entrepreneurial investors is based on three fundamental principles:
- Business ownership mindset: Investments are most successful when they are businesslike. That's why RICHTWERT views every investment as the acquisition of a stake in a company, not just the purchase of shares. Many people claim to do this, but almost nobody does. The difference is that you distance yourself from short-term share performance and, like an owner, focus on the business performance of the companies you invest in. This is because business owners know that their investments are successful when their businesses are successful. Doing so, you should ask yourself whether you will be happy with your investments even if the stock market closes for the next five years and you have no opportunity to sell them. You should also ask yourself whether you are prepared to significantly increase your investments in the respective businesses if the companies perform well but their share prices fall.
- In the same boat as the investors: Bahram Assadollahzadeh, CFA®, who is responsible for investments at RICHTWERT, ensures that his interests are aligned with those of the investors by investing the majority of his liquid net assets in the same strategy. Investing one's own capital in the same way as that of investors is key to making sound investment decisions.
- Minimal fees and performance-based partnership: RICHTWERT keeps fees as low as possible and only receives a profit share if the performance achieved exceeds an annual hurdle of 6%. This ensures that RICHTWERT is rewarded for performance and not just for the gathering assets.
Success through disciplined investment criteria
Every company invested in according to the above principles must fulfil the following criteria:
1. Simplicity: The business is easy to understand, with success or failure determined by only a few enduring factors.
2. Long-lasting advantages: It has strong or growing competitive advantages that can protect it from competition and during difficult periods.
3. Strong management: It is led by competent and motivated managers with integrity.
4. Attractive price: It is attractively valued, providing a margin of safety from uncertainty.
Investing with this approach does not simply mean buying shares, but acquiring holdings in carefully selected, high-quality companies with sustainable competitive advantages and strong management at attractive prices. It also means choosing an investment manager who is aligned with the interests of investors and committed to creating value through a success-orientated partnership model.
There are many ways to invest successfully. Investors should choose an investment strategy that fits their goals, risk appetite, risk capacity and time horizon. RICHTWERT's approach is best suited to investors who are business-savvy, who understand that market volatility creates opportunities, and who seek to protect and grow the purchasing power of their assets over the medium and long term.
