Our Process

Our fundamentally driven investment process focuses on the core tenets of risk-adjusted returns and preservation of capital.  We seek to deeply understand key opportunities and risks in both the indices and the market, including second and third derivative impacts on positioning.  We believe that the indices are not a proxy for appropriate portfolio positioning across a market cycle. We are willing to deviate significantly in order to position our clients for a better investment experience, in both bull and bear markets. This is achieved with an unwavering focus on fundamental analysis of individual positions, quantifying risk reward profiles that allows for security selection, and sector rotation to drive outperformance of portfolios.

 

Key tenets of our process:

  • We believe in active management.
  • A thorough understanding around indices positioning, composition biases, and risk return profiles.
  • Detailed review of the biggest risk exposures within indices, both outright and unintended risk factors allowing for better portfolio construction – avoiding the areas of highest risks and focusing on the preservation of investor capital.
  • Portfolio construction is driven by the greatest opportunities to find risk-adjusted returns, as opposed to an outright return profile.
  • Seek securities that meet disciplined performance criteria via fundamental and holistic company and collateral analysis validated by macroeconomic and technical market stress testing.
  • Maintain a deep understanding of what drives interest rates and the impact of the yield curve across markets.
  • Special attention to risks associated with the portfolio, including volatility, correlations, VAR, liquidity factors, stress testing, and scenario analysis.
  • Consistently challenging all investment assumptions within portfolio positioning and ideas.
  • Utilizing proprietary technology to confirm security return profiles, highlighting liquidity opportunities in the market and focusing the risk management process into an active part of the investment process.
  • Streamline market information, separating opportunity from noise, leading to a more efficient and insightful decision-making process around portfolio and security positioning.

Investment Principles

Risk-Adjusted Return

All opportunities are viewed through the lens of the risk associated with achieving an expected result. We utilize a bottom-up process to identify securities that offer risk reward profiles that fit our criteria based on what we see in the market and where we are in the cycle.

Preservation of Capital

As active investors, preservation of capital takes priority in seeking returns. We are willing to zero-weight sectors of the market to protect capital for our investors as well as protect them from suboptimal risks that exist within the broad market indices.


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