The growth theory of investment works

At the beginning of the year, we cautioned against becoming too obsessed with annual performance numbers, because what really matters for most investors is performance over periods of time much longer than one year.

That said, we would like to point out that the principles of classic growth investment theory which we discuss on this blog do work. In fact, we would argue that the cold hard record of investment performance is one way of validating the opinions somebody tells you -- in the investment world, if someone is full of hot air, the market often has a way of exposing that in the end.

Above, we show a graph and table of the performance record of the portfolios we manage according to the investment discipline we discuss on this blog. We have presented many arguments in the past against those who take aim at active management, calling it a waste of time (or worse).

Perhaps the best counterargument against those theorists are the track records of active management that has invested capital in above-average companies, and have the results to prove it.

This performance record only shows the period of time since we founded Taylor Frigon Capital Management. We've been at this for twenty-five years now, but regulations do not allow linking this record to the previous record. Nevertheless, we can say with great conviction that we firmly believe in active management, and the investment process that we use and discuss with you the reader.