Investment Approach

Distinguishing Features

  • Active, bottom up, investment approach employing both quantitative and qualitative research
  • Managed by an experienced, well-regarded portfolio manager who is a specialist in investing in small and mid-cap companies
  • Interest aligned with investors, significant manager investment in funds

Our Investment Process

Regardless of market conditions we apply a rigorous research-based methodology to the selection of companies for inclusion in our funds. The following are some of the components we use to evaluate companies:

Analyze the Sustainability of Business:  We look for businesses with distinctive competencies and financial strength that are operating in industries with favourable dynamics.

Identify Improving Financial Metrics:  We focus on identifying companies that are experiencing increasing revenues, earning and dividend growth, in addition to rising cash flow and free cash flow over a one to three-year period.

Valuation:  We focus on cash flow and balance sheet analysis to estimate the intrinsic value of a company.  Our team seeks to buy companies that are selling at a discount to our estimate of their intrinsic value.

Seek Unrecognized Value:  We seek to identify undervalued or underutilized assets or factors that will potentially improve the valuation of the companies within our investment horizon (3-5 years).

Evaluate Management:  We seek companies with outstanding management teams who are committed to financial transparency and have demonstrated an ability to create shareholder value.

Disciplined Portfolio Construction & Sell Discipline

Our research allows us to invest with conviction.  We purposely limit our funds’ holdings to between 25 and 35 securities.

Position Weights

  • Initial position size is typically 1 to 1.5%
  • Max position size is 5% (market)
  • Typically top 15 holdings represent 50% of portfolio

Sell Discipline

  • Extended valuation
  • Negative company or industry development
  • Acquisition activity
  • Portfolio upgrade

Holding Period

  • Typically 3-to-5 years
  • Portfolio turnover typically 25% to 35% cash
  • Used as strategic asset
  • Max cash position is 25%
Investment Philosophy

We invest exclusively in under-researched promising small and mid-cap companies.

Firm Culture

Our unique culture is based on a providing outstanding service to a limited amount of advisors and their clients.

Our Team

Led by our founder and CEO Michael Waring, our team consists of talented, dedicated professionals.

Contact Us

Want to learn more?  Have questions?  Please contact us.