Kurm Investments Inc. is a British Virgin Islands Professional Mutual Fund. The Company’s investment objective is to achieve capital preservation and longer-term capital appreciation predominantly through “value” investment.
VALUE INVESTMENT
Value Investment aims to preserve and grow capital through consistent and conservative investment with a view to achieveing long-term capital growth
While the returns of various value investors have varied from year to year, there is a record of steady performance, and limited experience of capital loss. In addition to Warren Buffett there are a number of seasoned value investors who have generated superior and consistent returns. Most of today’s value investors take the principles of their approach from Benjamin Graham, who practiced and preached this style of investing all the way back in the 1930s. It is arguable that Lord Keynes, the famous economist, and a number of investors from earlier times also practiced an investment approach similar to what is now called value investment.
Benjamin Graham communicated through his seminal books, “Security Analysis” and “The Intelligent Investor,” as well as through his class at Columbia University. The basic ideas he espoused were:
1. To think of a stock as a piece of a business.
2. To always invest with a “margin of safety.”
3. To think of the stock market as a strange partner, “Mr. Market,” some times offering you a very high price at which he will buy your shares, and at times offering to sell his share at a very low price. Even if you ignore him, he comes back every day with his offers. It is up to you to decide whether to
ignore him or to take advantage of him.
Benjamin Graham used to invest in a widely diversified list of companies which were statistically cheap. He often invested in companies valued below their book value or even below the value of their quick assets (current assets minus total liablilities). Investors like Buffett and his partner Charlie Munger have now developed this strategy in a way that focuses on buying businesses with long-
term sound economics, reflected in high returns on capital and on incremental capital, as well as a defensible competitive advantage, with honest management teams which think and act like owners. Buffett’s style is very concentrated. It can be seen from this, that value investment comes in various forms.
Value investors typically invest in companies which are misunderstood or are out of favour for a variety of reasons. Often, there is bad news about the industry in which they operate or something specific to the company. This means that the market is generally negative on these companies and the share prices reflect this. If the troubles have been blown out of proportion or are temporary, the value investor stands to profit when the market in general changes its perception to the underlying realities.
This means that value investors are often contrarian or seen to be “catching falling knives.” Sometimes, such negative sentiment can impact: whole industries, such as during the technology boom when investors mistakenly neglected “old economy” stocks; whole markets such as Korea recently or emerging markets in 1994 and 1997; certain asset classes, such as UK property in the early 1990s. The gloom can impact the markets in general such as in the late 1920s, early 1970s, and late 1980s.
Such an attitude also means that value investors typically avoid following the herd mentality, and they sit out on the many bubbles which inflict damage on the wealth of generations. As Warren Buffett put it, be “greedy when others are fearful and fearful when others are greedy.”
REGULATORY DETAILS
Kurm Investments Inc. is an open-ended investment company organised as a limited liability company incorporated in the British Virgin Islands under the Business Companies Act, 2004.
The Company is Recognised by the BVI Financial Services Commission as a Professional Mutual Fund and was granted Recognition Certificate RC/PIPO/07/3923 in accordance with Act on 15 February 2007.
To verify the company's recognition by the BVI Financial Services Commission please click on the following link BVI Financial Services Commission