Our experience has shown us that investing in successful, growing companies—ones that manage change advantageously and are poised to exceed expectations—has the potential to result in outstanding capital appreciation. The causes of this positive change could be a new product, competitive advantage, regulatory change or management change. We then determine if the positive change is sustainable by reviewing its long-term earnings potential, financial strength and quality of management. We confirm the timeliness of the investment by reviewing the stock’s relative price strength, market sentiment and economic factors impacting the company.
A Disciplined, Forward-looking Approach to Growth Investing
We use a forward-looking growth strategy to security selection, combining rigorous fundamental analysis with the discipline and objectivity of quantitative analytics. Our proprietary model is based upon our philosophy of positive change, supported by sustainability/quality and timeliness measures. Using the latest technology to efficiently examine and narrow a broad universe of securities plus a proven external research network developed over the last 25 years, our portfolio managers apply their expertise in identifying potential holdings meeting our buy criteria.
Security Selection Drives Portfolio Construction
Portfolio construction is determined by the strength and conviction in the underlying security’s investment thesis, irrespective of industry or sector. As active growth managers, our clients’ portfolios are fully invested with no idle cash. In order for a new idea to be bought, an existing holding must be sold. Each holding has to continue to earn its place in the portfolio.
Understanding Sources Of Risk In Relation to Potential Alpha
To ensure our clients' portfolios are positioned to capture alpha and to manage significant risk exposures, our investment team continually monitors and evaluates the risk/reward characteristics of each holding in our clients’ portfolios. Our process enables the portfolio managers to understand the sources of risk in the portfolio. It also allows the portfolios managers to confirm their level of conviction in those holdings generating the highest stock-specific risk.
Commitment to Performance
We are committed to remaining a performance-driven investment firm specializing in active equity and convertibles strategies for a select number of institutional investors and subadvisory clients. As part of our commitment to deliver value-added performance, we will restrict our asset growth in each capacity-limited product. We are setting aside $1 billion in capacity in US Small Cap, $3 billion in US Growth Equity (mid cap growth) and $750 million capacity in Convertibles/Convertible Arbitrage.