The Resolute Way: Our 25 Principles


“40 years of investing has given us ample
opportunity to see what works and what doesn’t.
We hope this list may help aspiring investors
learn from our experiences.”


  1. Be a Long Term Investor
    Short-term price fluctuations are generally unpredictable.
  2. Have a Flexible Investment Style
    As any investment style becomes too popular, it becomes less effective.
  3. Actively Look for Ideas
    We find our best ideas; they don’t find us.
  4. Buy Only The Best Ideas
    We prefer to buy only our best ideas.
  5. Outperform by Being Different
    To have a chance of outperforming the indices, invest differently than the indices.
  6. Filter out the Noise 
    We are drowning in useless information; the challenge is to use only what is relevant.
  7. Arbitrage the Growing Difference Between Reality and the Official Reality
    Have a broad range of information sources.
  8. Skepticism is a Virtue 
    Every day we strive to be more skeptical.
  9. Free Markets — An Outdated Concept from the Twentieth Century
    Understand the motives and means of the players.
  10. Think Like a Fiduciary and Deal with Others Who Do 
    Customers should NOT be treated as counterparties to be exploited.
  11. Corporate Governance Is Key 
    Too many boards focus on how to enrich themselves rather than shareholders.
  12. “Skin In The Game” 
    We prefer boards and management to have their incentives aligned with stakeholders.
  13. A Good Card Player Does Not Show His Hand
    Confidentiality is essential.
  14. Being Small is an Advantage
    It is easier to outperform being small.
  15. Know Your Limits 
    It is just as important to know what you don’t know as it is to know what you know.
  16. Stay Humble
    Stay humble or the market will make you humble and do not attach your ego to any investment ideas.
  17. Espouse Radical Honesty
    Strive to work with honest people. Above all be honest with oneself.
  18. Too Much Emphasis is Placed on Precision
      We don’t need exact numbers or complex models to make decisions.
  19. You Don’t Have to Succeed by being Original
    You succeed by being right.
  20. Short Term Volatility is not Synonymous with Risk
    The obsession to reduce volality can impair long-term performance.
  21. Be a Contrarian
    Too many investors prefer to fail conventionally than succeed unconventionally. Some of our best successes have been betting against widely held beliefs.
  22. Look at Track Records 
    Many prominent financial advisors and academics have no successful track record of investing.
  23. Do Your Homework
    Check facts with evidence-based observations, then make decisions based on facts.
  24. Be Thrifty 
    Moderate costs facilitate moderate fees. Moderate fees facilitate performance. Also, if someone is paying us a reasonable management fee, we don’t think it is fair to take 20 percent of all of their profits just to show up everyday and do our job.
  25. Critical Thinking Skills Are Paramount 
    A formal education with rote learning has little to do with the critical thinking skills needed to be a successful investor.