Our Philosophy

We are value investors - we minimize risk and maximize potential return. Frank Capital only buys stock after a company survives our intense analysis. Our research is twofold.

First, we use a by-the-numbers approach based on the principles Benjamin Graham articulated in his 1934 landmark book, Security Analysis. Graham's theory was that every business has an intrinsic value, independent from its quoted price on the stock exchange. Frank Capital calculates this intrinsic value several different ways, using the value of assets, enterprise value to EBITDA ratios, free cash flow ratios, and return on capital. We concentrate equally on the balance sheet, cash flow statement, and income statement.

The second part of our research examines the financial statements, company letters, conference calls, and any other information we can find for ethical problems, management issues, and market position. For example, we enjoy investing in companies with barriers to entry that protect them from future competitors. Warren Buffett called this technique "finding a moat."

Why Us?

Investing in our mutual fund as an alternative to a much larger Wall Street firm is an excellent decision. We are small and can move in and out of positions much faster than a company with significantly more assets. Plus, our managers do not have to meet short-term performance targets, allowing them to focus on the long-term. Funds with short-term targets sometimes juggle positions to chase performance – we believe this is harmful to the long-term health of a fund. Our long-term focus is in investors' best interest.