Stocks are by definition riskier than bonds and, at current prices especially, shouldn’t be substituted for bonds without recognizing the risks.

Hold on, some say, risk lessens for long-term investors, since any negative event in stock prices becomes distant memory when investing over a long duration.

Let’s me argue against that point.  First, stocks are by definition simply a share of ownership in an enterprise.  Unlike with bonds, equities are not a promise to pay or receive anything.  Over time, you might receive nothing for your stock, unless the company declares dividends or you decide to sell your stock to another investor.

Risk doesn’t necessarily average lower over time, just as the risk of crossing a busy divided highway by foot doesn’t lessen the more times you do it.  I’ve bicycled on short stretches of interstate, which is perfectly legal out west, and it’s not fun to travel in the same direction as such fast, heavy traffic, let alone cross in a perpendicular direction to it.
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This winter, I’m cautious amidst the market traffic of gravity-defying prices in stocks.  Be balanced, now is not the time to take chances.

Small is beautiful.  This quarter, we highlight small companies we invest in.

When you buy small, you get focus and, as the owner, it’s important to know what you own.   I dare any Wall Street analyst to tell me exactly what a large multinational conglomerate does.  It’s vast.

A company is more than a balance sheet and profitability measures.  It’s important to understand both the bigger picture and the detailed implications.  With a smaller company, I can talk or meet with management.  While not every investment opportunity is a small one, smaller ones can be among our most rewarding.