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Searching for What Matters Most
Our bottom-up, research-driven investment approach relies on a
combination of quantitative screens and fundamental analysis to identify
stocks for client portfolios.
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Strict Screening Measures
The quantitative portion of our process involves a combination
of liquidity and valuation screens to find potential
investment opportunities.
Rigorous Fundamental Analysis
Our approach is designed to develop a specific “investment
thesis”— we are looking for companies that we believe
are undervalued for a reason, have stock prices that fail
to reflect their intrinsic value, and are likely to revert to
their mean.
Research is at the Heart
We place a heavy emphasis on financial analysis when we are
seeking investment opportunities. We closely assess a company’s
balance sheet, cash flow and income statement to determine
what we believe is its true worth, and focus heavily on companies’
accounting standards and practices. We also pay close
attention to sources of future growth, each company’s specific
position within its industry, and the relative strength of management
teams. Our analysis is often supplemented by discussions
with company management, industry analysts, suppliers and
competitors.
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Setting Price Targets
The result of our fundamental and quantitative research is to
identify specific price targets for each company in which we have
chosen to invest. We set a price target based on what we believe
each company is actually worth, and hold that company until its
stock price reaches that target. Price targets are adjusted as the
market and factors determining these targets change.
Absolute Risk Management
We believe that risk does not reside in price changes, but rather
in miscalculations of intrinsic value. Our investment process is
designed to identify a company’s true intrinsic value as a way to
both maximize returns and minimize potential risk. Additionally,
individual position sizes, industry exposures and liquidity issues
are all managed to mitigate risk in the portfolio. As with all of
our buy and sell decisions, our risk management is based on the
judgment of our investment team, not necessarily on the metrics
of an industry benchmark. |
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