Be flexible in thinking

MAXVAL is flexible in thinking but unshakeable in principles

Approach & Principles

Investment Approach

MAXVAL is a value investor. The all-important factor is the discrepancy between value and price. More precisely, the difference between the share price today and the intrinsic company value per share in the future. Depending on the investment situation, the future can be two, five, ten or more years. MAXVAL's strength lies in this flexibility. MAXVAL is not stuck in rigid thought patterns. MAXVAL is flexible in thinking, but unwaivering in the required discrepancy between value and price.

 

MAXVAL's core know-how consists in recognizing value and its mispricing in the stock market in different forms and situations. This is what makes MAXVAL's investing approach unique.

 

For one company, the factored in long-term free cash flow growth is well below what an extensive internal fundamental analysis has shown. For another company, MAXVAL's research shows a clear undervaluation based on normalized earning power, although the company is not growing. Own detailed analysis of another company shows that the intrinsic value of net assets after deducting all liabilities is well above the current market capitalization. Ideally in conjunction with an expected catalyst that will remove this undervaluation.

 

MAXVAL prefers the first form of undervaluation because it enables fund investors to achieve above-average investment returns over many years with a single investment decision. Nevertheless, MAXVAL capitalizes on mispricings that also enable other forms of value. This makes the MAXVAL approach supremely robust and reduces the risk.

 

Fundamental investment risks are consistently limited.

 

MAXVAL defines the risk of an investment as a permanent loss of capital. It is imperative to avoid this. MAXVAL limits this risk through strict selection criteria when selecting companies with a focus on quality companies with strong fundamental data, through extensive research and through its own fundamental analyzes with a focus on cash flows as opposed to accounting profit figures and above all with the principle of the margin of safety when investing. MAXVAL does not see volatility as a risk, but rather as a great advantage, to specifically exploiting mispricing in the stock market.

 

The focus is solely on the long-term maximization of the aggregate intrinsic value per fund share and the achievement of a compound annual growth rate that is above that of the entire stock market. MAXVAL's understanding of successful investing is based on a number of investment principles in order to generate the desired added value for fund investors:

Investment Principles

MAXVAL is a value investor

All investment decisions are based on the discrepancy between value and price. The fund's capital is only invested if the intrinsic business value can be determined with a high degree of certainty and if the discrepancy to the price is sufficiently large.

MAXVAL invests rationally

Investment decisions are rational if they contribute positively to maximizing the invested capital over the long term. The fund's capital only gets invested if MAXVAL expects a positive return that is significantly above the long-term market average.

MAXVAL favors performance over size

MAXVAL measures its success by the long-term percentage performance of the capital of fund investors and not by the fund's size. Inflows of funds are welcome as long as they do not pose a disadvantage to existing fund investors.

MAXVAL invests with a margin of safety

The margin of safety is the positive difference between value and price. It limits fundamental investment risks and helps to avoid permanent loss of capital. It is also a source of future expected investment returns.

MAXVAL invests in its best ideas

Diversification does not correlate with outstanding investment returns. That is why MAXVAL pursues the concept of best ideas. Really attractive investments are rare and are therefore highly weighted.

MAXVAL doesn’t consider volatility as risk

On the contrary, volatility is a great advantage. Fund investors benefit from price fluctuations when investments are made below the intrinsic business value and sold in overvalued situations. This increases the value of the invested assets.