How and what we hold

We add tradable stocks after conducting deep fundamental research. If the company is a great business, we will hold it as 1% of the portfolio, even if it’s priced above fair value.

When we have strong conviction in the potential for significant returns—due to both the discount rate and growth rate—we’ll increase our position to 20%.

If the price rises well beyond fair value, we’ll reduce the position back to 1%.

The minimum criteria for our investment decisions are whether a company’s gross profitability per person is growing, whether this growth is sustainable, and if it can continue. This directly relates to evaluating their business model.

If a company cannot meet these criteria, its competitive advantage will likely erode in the near future.

Japan has long made the mistake of not evaluating people in a fair manner.