Equity Portfolio Risk Management

Individual Security
Risk control at the individual security level is primarily achieved through our institutional mindset that puts wealth preservation on equal footing with creation. Investments are generally held with a one- to three-year time horizon with sell targets established when a stock is purchased. If a stock reaches its target price it's sold unless fundamental research suggests there is further upside potential. If a stock falls by more than 10% post-purchase, it is placed under formal review or should stock fundamentals and key assumptions change, it is sold.
- Internal research, 50-100 stocks closely followed - Proprietary models on each and every holding
- Models updated regularly - Securities are placed under formal watch if price drops > 10%
Portfolio Construction
We ensure every holding complements others throughout the portfolio construction process. Balance is maintained across industries, sectors and geographic locations to meet the necessary objectives of the Fund while reducing volatility to keep returns stable. We also limit the number of portfolio holdings in each Fund, as individual security risk can be more effectively monitored when the number of companies is reduced because our understanding of each is increased.
- Daily monitoring of portfolios by the trader and the portfolio manager - Attribution Analysis (daily, weekly, monthly, quarterly)
- Weekly meetings to discuss investment decisions and new ideas
Every portfolio holding is reviewed on a daily basis with more formal, in-depth analysis conducted at weekly and quarterly meetings. At these meetings, the portfolio management team revisits economic and market forecasts, sector dynamics and the original investment thesis behind each security to ensure it remains intact.
- Bi-weekly meeting with CEO to discuss portfolio decisions/performance - Weekly performance review committee meeting
- Monthly asset mix committee meeting