In his January 1962 letter to his partners, Warren Buffett wrote, “I have consistently told partners that it is my expectation and hope (it’s always hard to tell which is which) that we will do relatively well compared to the general market in down or static markets, but that we may not look so good in advancing markets. In strong advancing markets I expect to have real difficulty keeping up with the general market.” Most value mangers we respect have shared investment experiences similar to the one that Mr. Buffett describes here. We do not think it is unreasonable to expect the Fund to underperform in runaway markets and make up for that underperformance in other types of markets. An overpriced market is a substantial risk to a long-term investor, as deploying capital at high price-to-value ensures mediocre long-term performance. Of course hidden gems and overlooked securities with good price-to-value can be found in high valuation markets, and we will always search diligently for these opportunities.