International Value Advisers, LLC (IVA) will seek long-term growth of capital by investing in a range of securities and asset classes from markets around the world. Over the short-term (12-18 months), our attempt is to try to preserve capital, while over the longer-term (5-10 years, i.e., over a full economic cycle), we seek to outperform equity indices. We are absolute return oriented investors.
We employ a fundamental, bottom-up approach and have a preference for quality businesses with securities trading at what we believe to be a meaningful discount to our intrinsic value estimate. We define intrinsic value as "the amount that a knowledgeable investor or corporate competitor would pay - in cash - for 100% of the economic and controlling interests of a company.” A security is deemed attractive if there is a suitable margin of safety, meaning that the market price of a security is trading at a meaningful discount to its intrinsic value estimate. The size of the discount required and the position size is determined by the following criteria: quality of business, quality of balance sheet, quality of capital allocation, ability for intrinsic value growth, quality of management, liquidity/free float, dividend payout, and concentration/quality of shareholders.
Additionally, we employ a flexible approach, which may include securities across all asset classes (equities, fixed income, gold, cash) and securities throughout the capitalization spectrum (small, mid, large caps).
We believe that this investment approach emphasizes capital preservation while still providing the capacity to outperform equity indices over the long term.