Horizon Kinetics' Investment philosophy remains unchanged since the founding of the firm in 1994. Our fundamental investment approach, initially developed 25 years ago at Bankers Trust Company, capitalizes on the overwhelming need for investors to achieve short-term results. Long-term price inefficiencies can be created by the collective, short-term focus of the markets. Events visible 3 to 5 years in the future have little utility to the average portfolio manager. We seek to identify and exploit resulting long-term pricing anomalies to generate unique, above average returns.
In concert with our absolute return mindset, we typically concentrate portfolios and do not attempt to track or mimic any index or benchmark. Further, our research analysts are generalists and search global capital markets for what we believe to be the most attractive securities prior to recommending a company for investment.
Extend the Time Horizon
Superior long-term wealth is created by investing in companies whose present market valuations ignore their long-term potential. Horizon Kinetics' portfolio returns are driven by the long-term returns on capital of companies' underlying business operations rather than timing the purchases and sales of investments.
Investing is a Social Science
A thorough understanding of social sciences (e.g., History, Economics, Philosophy, Sociology, etc.) provides valuable context and perspective for investment decisions. The industry's abundant use of emotive words and focus on short-term results can lead to behavioral biases and sub-optimal decision making.
Qualitative & Quantitative
Successful investing requires the integration of the qualitative aspects of social sciences with the logical reasoning and mathematical abstractions of physical sciences. The near limitless amount of quantitative data available in financial markets has limited value without proper historical perspective, social context and fundamental analysis.