We are conservative and risk averse investors. Mitigation of risk is one of the most important factors in our investment philosophy. We define investment risk as the permanent loss of capital. With each investment opportunity, we focus on whether and how we could lose money. Risk is controlled at the source in several ways: by a thorough and rigorous analysis prior to investing with a focus on downside protection, through a comprehensive understanding of exposures to common risks and the correlation among portfolio holdings, through strict adherence to the firm’s established investment process, ranges for the three proprietary categories of investment opportunities as well as industry, sector and individual position limits. The risk management function is ongoing and includes continuous monitoring for and evaluation of new fundamental risks.