When selecting a money manager, it is important to understand the manager's investment strategy. Below is an outline of the investment strategy that I use at Remick Capital as a guideline for the management of clients' money. If this strategy makes sense and aligns with your own goals, then Remick Capital may be the right manager for some or all of your investment capital.
For additional details, please see my Disclosure Statement.
Value-Based Investment Selection:
I seek to invest in businesses only when they can be purchased in the stock market for substantially less than what I believe the businesses assets are worth. I do not focus on price trends or stock charts or macroeconomic forecasting. I only seek to buy business assets at a substantial discount to their true worth. Over time, I believe the market will recognize this value discrepancy.
Moderate Portfolio Turnover:
I seek to invest in quality companies with strong competitive advantages that can be held for many years. This reduces transaction, accounting, and tax costs for myself and clients. In general, my target is to maintain an annual turnover of less than 40%; this equates to an average holding period of 2.5 years on the investments we purchase. While I strive for moderate turnover, I will not hesitate to exploit short term pricing movements in securities when I am confident that they will deliver attractive returns after transaction costs and taxes.
I believe that the rule of diversification, while solid in principle, often leads to mediocre returns by forcing the addition of weaker investments to a portfolio of superior selections. I focus clients' portfolios into only the most optimal investments. Portfolios will generally be concentrated into 10-15 individual long investment positions. The number of short positions will generally be less than 10.
Hold Cash and/or Hedge When Necessary:
During time periods in which suitable investment opportunities are unavailable, I will keep excess portfolio assets in cash or money market investments. While this is not ideal or exciting, it is far preferable to investing in businesses that do not meet my criteria. Also during times when I believe there are hedging opportunities to protect the portfolio against a general market downturn, I will make use of them.
When researching suitable investments, I look for value wherever it might be. I do not focus solely on 'blue chips,' 'growth stocks,' 'tech stocks,' or any other trendy group of investments. The portfolios I manage will often contain unpopular and unknown companies.
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