Value Growth is an all-cap approach offering both capital appreciation and risk management. We are generally invested in 20 to 40 companies at any given time. We will also invest in an handful of Exchange Traded or Closed-end funds when we find a sector, industry or region which is showing broad value or momentum characteristics.
Many smaller and mid-sized companies are under-followed by Wall Street which gives the enterprising investor the opportunity to benefit from our independent research.
Value Growth regularly uses a conservative option selling strategy in order to hedge risk and generate portfolio income. On rare occasion this strategy will also take positions that benefit from a security, industry or sector falling in price by buying put options or using inverse ETFs.
We find our universe of stocks to consider using multiple screening strategies. When a company appears on more than one screen we then drill deeper down into the company in order to analyze their business. Our favorite screening tools scan for companies that pass certain fundamental measures, such as, earnings growth, earnings yield, free cash flow, return on assets, return on equity and sustainable growth.
When we drill down on a company we are looking for a business model that in some way has a sustainable comparative advantage to competitors or the market in general. We have a strong bias towards companies that benefit from monopoly pricing pressure, i.e. there are few substitutes for their products and/or tight supply in their markets.
Value Growth may be sub-advised by another leading adviser in certain situations when clients request a higher level of customization and/or prefer a two heads are better than one approach.
This strategy is appropriate for investors seeking an equity strategy that offers the opportunity for higher growth with risk similar to the overall stock markets. Because all equities are highly correlated as a group, this strategy will likely have wider swings in returns than our Tactical Asset Management Solutions. This strategy is suitable for moderately assertive investors with a minimum seven year time horizon.
Contact Kirk Spano directly to learn more.