Investment Process
The distinction and repeatability of our investment process sets us apart from our peers in the asset management industry. While, like our peers, we scour the public equity markets for attractive investment opportunities, the majority of our best ideas are discovered naturally through our unique corporate restructuring process.
Of our five main investment themes, corporate spin-offs continue to be the most fruitful as well as the most inefficient. Initially, most spin-offs are not represented by an index and lack institutional ownership. This gives our research team an advantage for capturing value.
Additionally, the practice of spinning-off a division produces "pure play" companies, which are inherently easier to analyze and historically have been attractive takeover targets.
Although lack of coverage and sponsorship is a key advantage within our process, we also value pure fundamental analysis of a company's balance sheet and overall financial health. We pay particular attention to each company's business plan, management strategies, product offering, economic cycle and competitive advantages. Our rigorous in-house research is a critical element of our approach, as the restructuring process can often take three to five years to implement and execute.
We are patient once a position is established, which has historically resulted in low turnover in our portfolios.