Fairview Investment Philosophy
In-house Research Informs All of Our Investment Decisions.
Fairview’s values of disciplined decision-making, deep knowledge, and rigorous investment research inform our decisions. Our long-term investment horizon allows for tax efficiency so client assets can grow with fewer interruptions over time.
Many wealth management firms lack internal research teams: they outsource investment management to third parties. This outsourcing contributes to higher client fees, potential tax inefficiencies, and lack of oversight and portfolio control. Fairview Capital has an in-house, highly-experienced investment research team. The team’s expertise enables clients to own a portfolio of highly researched, top-quality businesses that should grow in value over time.
The cornerstone of our portfolio is individual stocks. The foundation of our investment philosophy rests on our belief that owning a stock represents a partial ownership in a business. As a result, we are less concerned with the daily whims of the overall stock market. Instead, we are focused on utilizing our proprietary, in-house research to identify and invest in a group of carefully chosen businesses for the long-term.
We seek to own companies with competitive advantages and strong balance sheets. We look for businesses run by honest and able management that trade at a material discount to our conservative assessment of their underlying intrinsic value. Our experience has taught us that companies meeting these strict criteria will flourish over the long term, regardless of the fits and starts of the macro economy.
High Standards and Focus
Given that truly exceptional investments are rare, we hold very high standards for including a stock in our portfolio. We often track companies for years, waiting for the opportune time to initiate a position in client accounts.
We tend to manage a concentrated – yet adequately diversified – portfolio consisting of 15 to 25 securities, but the number of holdings for any client may be different. Contrary to conventional thinking on diversification, managing a concentrated portfolio actually reduces risk because it raises both the intensity with which we analyze each investment and the comfort level we need to attain before committing to it. By allowing individual stocks to occupy the largest piece of our client portfolios, we avoid unnecessary taxes and fees, and we can concentrate client assets in only the most promising ideas.
Additional Portfolio Diversification
For clients seeking broad diversification in their portfolios, Fairview supplements its direct equity holdings with exchange-traded funds (ETFs) to gain exposure to fixed income, international and emerging market equities, international and domestic real estate, commodities and gold. Our research team analyzes various providers and selects low-cost ETFs from well-established, highly liquid, top-quality firms with strong management.