About Us
Investment Process
Investment Process – Disciplined Research
Our portfolios are all focused “Best Idea” portfolios which have delivered competitive value-added results that are driven by stock selection. Our quality value focus delivers low-risk profiles by avoiding “concept stocks” (stocks that may benefit from popular momentum and are valued beyond their net worth) in favour of measurable cashflow-based profitability, proven management and limited cyclical exposure. Portfolio candidates are assessed using our disciplined 5-Step Investment Decision-Making process. This is designed to rigorously assess a company’s ESG profile and management team while applying fundamental valuation principles to our price targets. Ultimately portfolio decisions are both independent and team-driven.
1. Screening – Company Snapshot
Proprietary datasheet providing insight to operations, cyclicality and key value creation drivers
2. Qualitative Analysis & ESG Profile – Initial Research
Develop initial thesis on company and fit with investment criteria
3. Management Assessment – Management Interview
Assess Management, gain further insight to strategy, business model, opportunities and threats
4. Company Valuation – Financial Model
Independent assessment of company and corroborate (or not) management narrative
5. Team Decision
Assess whether investment opportunity represents an attractive total return opportunity
Sustainability – Integrated Approach
We believe that corporate sustainability is directly related to a firm’s ability to deliver long-term growth in profit.
Sustainability – Engagement
Primary engagement with entities is via ongoing meetings and communications with managements/boards where we strive to share our views as investors and gain a better understanding of the company. As UN PRI signatories we also participate in collaborative engagements on select issues.
Environmental
- Climate change (Carbon/Greenhouse gases)
- Energy efficiency
- Water pollution
- Water/wastewater mgmt.
- Land use (biodiversity, habitat protection, site rehab)
Social
- Human rights
- Labour standards (health & safety, gender diversity, employee engagement, child labour)
- Indigenous rights (social & economic progress)
- Community impacts
Governance
- Board composition & independence
- Executive compensation
- Transparency
- Financial practices
Team-based Decision Making
Weekly investment team meetings integrate equity and fixed income decision-making. Team meetings oversee the “life-cycle” of a stock or bond in their respective portfolios. The life of an investment in the portfolio is initiated with the “Buy” decision with subsequent ongoing monitoring and trim/adds of existing positions, and ultimately concludes with sale of a position. We believe that the portfolio should be limited to our best ideas and accordingly limit holdings to 20 – 40 securities per strategy.
New Positions
- 40% return potential over 3 years
- New ideas run through the 5-step assessment process.
Current Holdings
- Evergreen Buy/Sell price targets
- Company news/earnings updates
Trims/Adds
- Opportunistic management of existing positions
Sell Discipline
- Full valuation vs. sell target
- 20% under performance vs. peer group => price target review
