Jamie Harmon, Portfolio Manager of Fidelity Advisor Small Cap, shared some takeaways from his 18 years of attendance at the Berkshire Hathaway annual meeting. In an interview with Andrew Daniels of Morningstar, Harmon said, “I think the thing that I really focused on from this year is the importance of great management and how they [i.e. Buffett and Munger] try to find great management in the companies that they buy, and they try to nourish and encourage great management that they already have.”

When asked how he handles short term fluctuations in stock price, he said, “I try not to focus on the price changes day to day in the businesses. I try to focus on the businesses themselves. How much of a competitive advantage do they have? What are they doing to grow their competitive advantage, and what are they doing to grow the business?” Like Buffett, Harmon said he focuses on buying good companies at reasonable valuations. He noted two stocks that his fund has held for a while: Ensign Group, a nursing home operator that focuses on turnaround situations; and Primerica, a direct distributor of life insurance and other investment products. “I think those are both great businesses with niche markets, strong management teams, and reasonable valuations.” Regarding his fund’s concentration in the industrial and financial sectors Harmon said, “My sector weights are based on a bottom-up process where I look for companies that I think are good. I don’t necessarily just wake up in the morning and say, ‘I love industrials.’”