Warren Buffett once said: "The ideal business is one that earns very high returns on capital and that keeps using lots of capital at those high returns. That becomes a compounding machine.” And luckily for us, we can learn to find these. Let's break it down:

Diversification is essential, but don't dilute your portfolio with mediocrity. Focus on quality companies with solid fundamentals, and watch your portfolio grow.

Adyen is down -69% from it's all time highs. It was very overvalued back in 2021. Now it trades at 20x forward earnings, growing its top line at 18-20%.

Fair Isaac is down -64% from its highs. This is the backside of concentration. $FICO When your largest holding moves against you, investors will surely leave the fund. Fund management is tough.

Gains needed to make up for losses in the stock market:

Kinsale Capital is down -38% from it's all time highs, trading at a forward PE of 16x

Essentials of focus investing:

What part of the business life cycle do you invest in? For me it is mature growth and mature stable.

Sustainable and consistent growth is what to look for in stocks:

How Bill Ackman invests:

"Bargains are the holy grail of the true stock picker. We see the latest correction not as a disaster, but as an opportunity to acquire more shares at low prices. This is how great fortunes are made over time” - Peter Lynch