Today's obsession seems to be with the very near term, whether it's one month, three months, six months or one year. That is a very crowded game to play. Essentially, you have a lot of people out in the market trying to play 'Snap.' At the end of the day, the victor is likely to be the ultra-fastest person, or a machine running an algorithm. On that kind of short-term horizon, I don't think we are in any way meaningfully advantaged as an investment manager.
We believe that a lot of people spend too much time deciding whether a particular stock is 5% overvalued, or 10% undervalued. I don't try to make such distinctions. In my view, this type of analysis offers very little reward to the long-term investor.
Instead, we focus on opportunities where we have a strong conviction about the probability of the stock price doubling within three to five years. Those kinds of opportunities tend to be more rewarding, and more relevant to our philosophy, given our long-term shareholder orientation. It's also worth noting that most market participants ignore that long-term horizon.
I believe we are advantaged when thinking about the longer term, so that's where we focus. That's where we put our resources. It's also why we seek out growing companies. If you focus solely on the value of a stock relative to some putative fair value, and you're wrong, and on top of it the business is not growing, then you're going to be wrong forever with no growth to bail you out. In that way, focusing on long-term growth can help maximize opportunity.