Frueh & Partners applies the Königsanalyse® and the Purity Law of Capital Investment for its clients.
Prof. Otte successfully refined this method of value-based capital investment and distilled it into his method of the Königsanalyse®. By application of the Königsanlayse® it is possible to define the investment quality of a company. Subsequently, a portfolio of only those businesses which achieved certain points within the Königsanalyse® and with a curren share value substantially lower than its intrinsic value has been compiled.
1. Quality of business model
2. Convenience goods / services
3. Sustained competitive advantage
4. The sector's potential of growth
5. Quality of management
6. Profit margins
7. Profit growth
8. History / Reliability
9. Capital intensity
10. Balance / Indebtedness
The Purity Law of Capital Investment, which has also been developed by Prof Dr Otte, states that investments should only be made in quality stocks, bonds and time deposits (including only such funds consisting of those forms of investment), as well as physical precious metals.