It means failure to act by reasonable behavior. Neither we, nor the majority of other heads don’t dream of feverish trade in assets of highly profitable affiliated undertakings only because minor alteration of discount rate of the Federal Reserve System or because certain specialists of Wall-Street have changed the opinion on the market. Then why we should act differently with minority shareholdings of the perspective companies? Art of successful capital investments in the public companies differs from art of successful absorption of branches. In each case you simply want to acquire the enterprise with remarkable economic indicators and a capable fair management for the acceptable price. According to you it is just necessary to consider, whether there are these characteristics available or not.
Frequently skillful realization of such investment strategy brings some securities which can quite become an important part of an investment portfolio. The investor could achieve similar result at purchasing of certain percent, we will tell 20 %, from the future incomes of several outstanding basketball players from a college command. Few of them become leading players of national team NBA. Then profits from their game become for the investor the basic and generous compensation. The assumption that this investor will sell some the most successful investments only because they became prevailing in its portfolio, and it is equivalent to the assumption that basketball team Chicago Bulls will sell Michael Jordan because it became very important for a command.
Studying our investment activity in the relation to affiliate companies, and common stocks, you will see that we prefer the companies and industries which aren’t subject to the big changes. The reason of it is simple: at this or that type of purchasing as the basic criterion for us high competitiveness which the company will possess in ten years serves. Quickly changing industry can bring huge benefit, but it doesn’t give that confidence which we search.
I should underline that we welcome changes: the fresh ideas, new goods, innovative processes, etc. raise a level of living. However as investors we concern roughly developing industries the same as to outer space exploration. We admire these courageous attempts, but we prefer to stand aside.
Certainly, any company undergoes some changes. Today company vision in many respects differs from that what it was in 1972 when we have acquired it. It offers other assortment of confectionery, uses others equipment and goods sales channels. But the reasons, on which people continue to buy boxes of sweets from us, instead of at somebody else’s, practically haven’t changed since 1920th years when members of a family of Si have based the business. Moreover, these reasons can remain invariable for 20 or even for 50 years more.
It is very reasonable that government, despite this crisis is not leaving to help small businesses. And small business grants can be a true helper today.
But, of course, you should remember that today the fight for small business grants as well as for other kinds of grants has become more fierce. This is logical – more businesses need them. So before you start your fight for the small business grants, please make sure to check out this blog for more info about grant industry.