Investment Strategy.

We manage a concentrated portfolio of longs and shorts focused predominately on U.S. SMIDCAP equity investments, using a fundamental, value & catalyst approach. The fund targets superior risk adjusted returns by utilizing low gross (i.e., 150% gross) and net exposure (i.e., 30% net), seeking to generate uncorrelated annualized returns through rigorous stock selection rather than through leverage & or market direction, thereby mitigating risk.  We seek to exploit the early innings inflections in earnings and/or unforeseen materially variant events, which we believe will create tremendous value for shareholders. We also place an intense focus on enhancing returns through scaling in and out of positions, based on changing risk/rewards.

Ponds We Fish In.

Companies at the:

  • Start/end of tailwind/headwind

  • Management transitions

  • Balance sheet optionality and changes in capital allocation (buybacks/dividends)

  • Large cost restructurings

  • Imminent activist activity

  • Takeout/spin off candidates, and other special situations including turnarounds & M&A.

Identify.

We seek individual securities with minimum 5:1 asymmetric risk/reward profiles over a medium-term horizon (6-24 months).  We require a materially variant view on both the scope and timing of fundamental transformational earnings re-ratings.  Opportunities have both fundamental inflection point triggers and special situation catalysts.

Research.

We simplify opportunities & probabilities with a Private Equity-like research approach to uncover misunderstood earnings drivers, how they interact with each other, & seek to find significant inflections with a high degree of conviction.  We ensure detailed fundamental research supports our conviction in quantitative views expressed via a financial model.  We remain cognizant of the opportunity cost of capital and aim to capture long term capital gains to generate a high internal rate of return.