Investing Style

                                                                                 "If you are going to be a great investor, you have to fit the style to who you are."

                                                                                  --Dr. Michael Burry, neurology resident turned value investor extraordinaire, 2010

In his celebrated book Security Analysis, the legendary Benjamin Graham wrote, "An investment operation is one which, upon thorough analysis, promises safety of principal and an adequate return. Operations not meeting these requirements are speculative." Clients of Peregrine should understand that we are investors, not speculators. As such, we concern ourselves with preservation of capital, and we focus on long-term real returns (after-inflation).

We are drawn to active investment managers whose portfolios are built one company at a time. We believe that investment decisions should be based on economic merit determined by a rigorous, bottom-up analysis of company fundamentals. We are concerned with how market price relates to business valuation, and in the long run, we believe that true value will be reflected in the stock price. Therefore, we choose managers who focus on acquiring ownership interests at attractive prices, and who wait patiently for those values to be realized.

We are not traders or market timers. We do not believe that securities should be bought or sold based solely on price momentum. We do not utilize technical analysis. We do not base investment decisions entirely on the current macroeconomic climate. We are not attracted to assets that don't produce cash flow and whose worth is only what some purchaser will pay. We do not like the risks associated with leverage and short-selling. And, we do not chase performance.