Charles Royce Quotes
103 Charles Royce Quotes
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[In April 2013.] The truth is that we can’t control everything, but we have a very disciplined approach to the stocks we buy. The balance sheet is probably the single most important thing we are looking at.
Charles Royce
[In April 2013.] We don’t want to take balance sheet risk, we want to take operating risk. We don’t want to take the risk of the enterprise not having enough fuel to last for the operating cycle.
Charles Royce
[In April 2013 on small-cap stocks.] They are risky, they’re more volatile for sure. But we attempt to mitigate that. And sometimes we’re successful, not always – maybe two out of three times.
Charles Royce
[In April 2013.] In the decline of 2008 and 09 we did not feel that we did a good job at all…
Charles Royce
[In April 2013 on how he could have done better for the 2008-2009 period.] I think that going to cash probably would have been the only alternative. Our companies with very strong balance sheets still went down – a lot.
Charles Royce
[In April 2013.] A market cycle is a better way to measure performance than calendar years.
Charles Royce
[In April 2013.] Market cycles can be shorter than five [years] and longer than five… They’re in the range of three – seven years. Five years is not a bad timeframe, but we don’t target a specific time, we’re trying to double our money in five years as a rough idea.
Charles Royce
[In April 2013.] We’re trying to double our money in five years.
Charles Royce
[In May 2013.] Active managers earn their fees building a long-term performance record through time arbitrage (The ability to discern long-term value – buying a stock before the market reflects that value.). Value investors succeed not by chasing relative returns, but by embracing the fundamentals of value investing, finding the strongest, highest-quality companies at the best possible prices.
Charles Royce
[In May 2013.] This market and the wide availability of credit rewards the overleveraged operation.
Charles Royce
[In May 2013.] It’s taken us a while to understand the destructive effects of quantitative easing.
Charles Royce
[In May 2013 on his first job being in bank-relations before getting into the equity-research department located nearby.] I guess I wagged my tail enough, so I got accepted into research.
Charles Royce
[In May 2013 on buying a stock temporarily impacted by Hurricane Sandy.] Sooner or later, the distortions will work out of the system, and then quality will show itself.
Charles Royce
[In May 2013.] Right now, we’re working our way through a bubble of fear, a mirror to how it was in the 1990s, when we were in a bubble of greed.
Charles Royce
[In October 2013.] We're in the risk/reward business.
Charles Royce
[In October 2013.] Risk management is triply important in the small-cap space because these are fragile enterprises… We have to employ all the tools available to manage these inherent risks which are higher than a large company.
Charles Royce
[In October 2013.] Customer concentration is a risk factor… Maybe the customers put them in business. Maybe the customers need them more than they need the customer. You never know until you peel the onion.
Charles Royce
[In October 2013.] We're looking for companies that have pre-tax, pre-interest returns on capital in the 20% range. We're not talking about single-digit… A company that is increasing returns is potentially much more attractive.
Charles Royce
[In October 2013.] We had a long-term investment in Knight. We were very thrilled with Knight's strategy as a dominant market maker. Very high returns on capital. And it's a great example of how things can go ‘bump in the night.’ Out of the blue, there was new technology. Pressed a button. Things blew up literally overnight, and we lost a lot of money.
Charles Royce
[In January 2014.] No one has a perfect answer because no one can say for sure where the market is headed next.
Charles Royce
[In January 2014.] The cyclical nature of markets is very real to us. We don’t pretend to know how to time market cycles, but we never get too excited during bullish phases like the current period, and we don’t get too upset during corrections.
Charles Royce
[In January 2014.] Most of the time, a five-year period would capture a variety of experiences, perhaps a whole market cycle or two. But occasionally it does not, and the result is a distortion springing from an uncommonly steady, mostly bullish period.
Charles Royce
[In January 2014.] Markets are always changing, and we work hard to be prepared for those changes.
Charles Royce
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