Noroian Capital Management's primary responsibility is to seek capital appreciation while preserving assets.

Investing is a long-term proposition. Superior investment results accrue to those who make a commitment of at least three to five years or longer. We believe investment success results from investing in the common stock of high-quality companies whose true economic performance is improving. Experience has shown us that a company's performance is not always reflected in its stock price. By investing in companies whose stock price inadequately reflects the exceptional economic performance of these companies, superior long-term investment performance is obtainable.

Preserving assets while investing in the equity markets is based on two principles. First, maintaining a disciplined investment approach is necessary. Second, we hold cash when our investment disciplines do not identify any attractive investment candidates. This happens only once or twice during every economic cycle, but can be very material to investment success.

Investment Style

We analyze a company's performance by focusing on its cash flow. Earnings can be managed, but cash flow is the life blood of a company. We begin by relating the cash flow to the assets from which it was generated, creating the cash flow return on assets (CFROA). If assets are managed properly, financed and grown appropriately, then cash flow returns will be realized, and the owners (shareholders) will be rewarded. Our stock selection process has three main components.

	Corporate Performance - Stable or improving CFROA - Appropriate capital expenditures - Strategic advantages
	Valuation -Fair value range appreciably higher than current stock  price
	Timing -When to own a stock -When to sell

From a universe of several thousand companies, we narrow our focus with our CFROA analysis. Then we determine if the stock price adequately reflects underlying corporate performance. If a discrepancy exists between the company's performance and its stock price, we try to understand why. Researching the company and its industry, we search for any strategic advantage that will provide the impetus for the stock price to reflect the real corporate performance.

Next, we study the stock price history to understand investors' perceptions of the company. At this point, we determine when is the most opportune time to own the stock. We have found that stock prices of great companies have remained below their fair value range for long periods of time. An analysis of accumulation, distribution, relative strength, money flows, and price patterns can provide insight as to the appropriate time to buy.

Similar to our buy disciplines, our sell disciplines are centered around price targets, CFROA analysis, and strategic advantages. In addition, a stock may be sold when it violates predetermined price support levels. Price targets are established before a stock is purchased and may change due to competition and an evolving economy. When the risk/reward profile of a stock in the equity portfolio becomes less favorable, it is sold.