Hughes Management is a research-oriented investment firm. As such, it intends to invest only in those companies of which it has in-depth knowledge, which includes a thorough understanding of a company’s business lines, its future earnings prospects, management, liquidation value, and its plans for growing its deposit base. Book value many times is understated, not reflecting the true value of all company assets. Even if all of the requirements for investment are met from a purely financial perspective, Hughes won’t invest if management is not capable, reliable, knowledgeable and shareholder-oriented. By concentrating on a small number (30-50 stocks) of particularly attractive investment opportunities at any one time, Hughes believes that it can provide much higher returns than would be provided in most other investment vehicles, and it believes that it can do so with a relatively low risk of permanent loss of capital. Hughes believes that by spending time and effort, first, to find and analyze the fundamentals of promising companies, and second, to understand the market in which the company operates, it will be able to generate returns well in excess of those found in the market as a whole.