Definition of “Risk” Odds of permanent capital loss Beta, tracking error, near-term underperformance
Definition of “Growth” Intrinsic value growth, durable moats, compounding machines Revenue and earnings growth
Value vs Growth Margin of safety:   invest at the intersection of growth and value Mutually exclusive
Intrinsic Value Scenario-weighted estimate of fair value based on a range of potential outcomes Price target based on most probable outcome
Time Horizon ~ 5 year average holding period “outperform this year,“ < 1 year
Concentration 15 – 40 positions > 100 holdings
Decision Making Students of behavioral finance, exploit manic/depressive nature of the market, aligned incentives Less rational due to internal and external pressures