Institutional Strategies

Small Cap Core

The strategy seeks to provide a concentrated portfolio of U.S. common stocks of small capitalization companies. The actively managed approach utilizes a primarily bottom-up investment style seeking the best blend between value and growth small-cap stocks. The team focuses on companies that exhibit strong or positively inflecting relative strength.

Investment Philosophy

  • Small-cap securities are inefficient by nature. They are less covered, have wider dispersion of expectations, more idiosyncratic risk, and thus offer tremendous return potential.
  • While the universe of potential small-cap companies to invest in is vast, focusing on companies that exhibit consistently strong or positively inflecting relative strength dramatically narrows the pool, improves the chances for success, and helps avoid value traps.
  • Having focus and conviction increases the potential for significant outperformance over time, but is best when married with an appreciation and process to mitigate unintended risk.

Investment Process

Small cap core investment process

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Key Features

Composite Performance History Since 4/1/2017
Benchmark Russell 2000 Index
Security Concentration The strategy typically holds 40–60 positions with concentration in the top 20 holdings of greater than 50%
Tracking Error Residual of the strategy's investment approach – not actively managed, but has historically ranged from 400–600 basis points
Sector Ranges Generally 1/2 to 2X index weight of large sectors
Position Size Initial positions around 0.5% to 1.0% typically; 5% maximum
Active Share Expected to exceed 90%
Investment Vehicles Institutional Separate Account
Collective Investment Trust
U.S. Mutual Fund: Institutional Share Class
Variable Insurance Portfolio