Offers investors attractive opportunities for capital appreciation and diversification within a less-widely-followed market segment. Small- and mid-cap companies typically demonstrate higher revenue and earnings growth potential than larger companies. Investing across both small- and mid-cap companies offers the ability to capture the appreciation of small-cap companies who are successful in growing into mid-cap companies.

Focus: specialize in dynamically growing small- and mid-cap companies
Insights: invest in both equities and convertibles for a holistic view of company
Discipline: combine breadth of quantitative tools with traditional fundamental equity and credit analysis
Alignment: constrain capacity to add value and invest alongside clients
Experience: principals have been managing portfolios for over 30 years

We believe that dynamic change often creates a disconnect between a company’s future earnings power and its stock’s valuation. Growth catalysts are often not fully understood and expectations tend to be adjusted upwards gradually. We seek to exploit this inefficiency by investing in dynamic companies exhibiting signals of change that will lead to an acceleration in revenue and/or earnings growth in which our research confirms the company’s growth is sustainable and its stock is a timely investment.

Portfolios are actively managed to continually drive to the strongest investment ideas. Position sizes are based on the conviction in the investment thesis of each company relative to other portfolio holdings and risk exposures. Early warnings signs that suggest deterioration in company fundamentals or earnings strength lead to timely sell decisions.

Risk analysis is essential to minimize uncertainties and enhance potential long-term gains for client portfolios. To understand intended and unintended sources of risk, our investment team leverages quantitative tools with experience, judgment and deep knowledge of the holdings within a portfolio on a daily, weekly and monthly basis.

Number of Positions     60–80
Geography                       US-listed public equities
Capitalization                  $100M to $60B 
Security Max                   5%
Sector Max                      40% or 2x max of Russell 2500 Growth Index
Cash                                 Transactional, typically <5% (max 10%)

Bottom up, research-driven stock selection. Industry and sector weights and factor exposures are a residual of the stock-selection process.

January 1, 2017

Separately managed account
UMA (model only)