Concentrated Absolute Value
The US Large Cap Value strategy employs an actively managed, high active share approach, focusing on long-term "buy-and-hold" investments in well-established companies within our “circle of competence”. The strategy employs both quantitative and qualitative screening methodologies coupled with stock selection informed by independent fundamental analysis. The strategy seeks to generate returns by concentrating investments in public businesses with strong cash-flow generation as the discount to our model of a company's "intrinsic value" widens.
All of our concentrated investments exhibit the following tenets:
Invest in businesses that have defendable franchises
The business produces solid fundamental results that will increase shareholder value over time
Invest with a margin of safety in the valuation of the company
Hold for the long-term, as long as the investment thesis remains intact
Invest alongside capable, owner-oriented management teams
US Large Cap Value generally invests in securities with a market capitalization greater than $5 billion. There are typically 25 - 40 holdings with portfolio turnover of 25 - 40%. New positions generally begin at 1 - 2% of the portfolio; however, the highest conviction ideas can grow beyond 5%.