At Vernonville Asset Management, we create and preserve investor wealth by investing in alternative asset classes through the identification of undervalued industries and sectors. Our clients receive real returns from businesses with strong management experience and profitable operations. This direct investment in companies and projects allows them to expand and increase their contribution to their local economies.
Our investment philosophy revolves around creating a positive return on invested capital. In most retirement accounts and 401K plans, price appreciation (speculation) is the only means by which to achieve investment returns. Asset price appreciation is a welcome bonus, but should not be the only mechanism by which an investor can receive a positive return on their investment. Income generation with concomitant price appreciation creates long-term wealth not price speculation.
This is paramount. Rule #1: Don’t lose money. Rule #2: Don’t forget Rule #1. Losing money within an investment portfolio devastates long term wealth accumulation. Mathematically, it takes a larger magnitude gain than the original percentage loss just to break even. This creates an opportunity cost of lost time, time that your money could have been generating a positive return as opposed to recovering from the initial loss. This is why protecting your principle is paramount.
The companies and real assets in which we invest are locally owned and operated and found in industries where the short term macro-economic climate has little effect on their day to day business operations and profitability. Because we make a direct investment in the companies, and not investments by proxy through the financial markets of Wall Street, we do not experience the price volatility that other funds experience. Neither short term political unrest in the Middle East, debt bubbles in Europe, nor stagnation in Washington, affect our ability to generate positive investment returns for our clients.
Open communication with our clients is at the heart of why VAM was created. Our intent is to change the investment paradigm that holds people hostage to financial planners and insurance agents who profit from their clients whether they make or lose their clients’ money. Through quarterly newsletters or immediate bulletins, depending upon the day’s news, our intent is to educate and inform our clients about how and why their investment is generating positive returns. And if there is a problem, what is being done to correct it. VAM does not generate recurring revenue from fund management fees, and our money is invested alongside our clients’ money.