A different approach to deep-value investing
The modern history of value investing begins with the writings of Benjamin Graham (1894–1976). Graham created a framework for investing that sought to rationalize the process of investing in public securities by reasoning that a publicly owned business can be analyzed based on its core attributes and that the market’s short-term fluctuations ought to be ignored. He argued that the price paid for a security is of paramount importance and that a “margin of safety” is an absolute necessity for producing long-term successful investment results. Deep-value investors are generally understood to comprise a camp within the value investing community demanding a greater discount, or margin of safety, in their investment selections. Deep value is associated with a process that emphasizes looking past macroeconomic factors and the vagaries of the market, and instead focuses on a rigorous analysis of a company’s assets, earnings power and possible conversion events in light of a particular price. We consider ourselves to be deep-value investors, but we distinguish ourselves in three important respects from traditional deep-value investors:
- When our target price is met, we sell.
- We pay attention to economic trends.
- We are interested in finding growing companies.
Founded in 1998 and located in metropolitan Washington, D.C., Roumell Asset Management, LLC is an opportunistic investment manager with a deep-value bias that manages funds in equity, balanced and fixed income accounts. The firm’s clients include individuals and corporations.