Two approaches to growth
Seeking companies with the potential to grow market cap and dividends over time.
Dividend income
Focusing on resilient mid-cap dividend paying companies with sound capital structures.
High conviction
Managing a concentrated, equally weighted portfolio in which every holding matters.
The strategy seeks to provide total return through a combination of current income and capital appreciation by investing primarily in a diversified portfolio of common stocks of mid-cap companies that we believe demonstrate favorable prospects for dividend payments, dividend growth, and stock price appreciation.
Attractive long-term return profile
- Historically, US mid-cap companies have outperformed broader US markets, with mid-cap growth companies outperforming a diversified mid-cap universe.
Higher total return with lower volatility
- Historically, in the mid-cap universe, dividend payers have generated higher annualized return with lower volatility than their counterparts.
Stewardship driven by a seasoned, impassioned team
- Strategy supported by a management team with more than 50+ years of combined industry experience, an analyst pool with a research lineage of more than four decades, and a support team offering a world-class client experience.
The team’s investment process is grounded in fundamental bottom-up research. The team spends the majority of its time evaluating individual company business models, including industry-specific dynamics that may affect their prospects for growth, with a focus on a three- to five-year investment time horizon.
Idea generation
Potential investment opportunities come from various sources:
- Interactions and discussions with internal and external analysts, meetings with company managements, conferences, and research reports.
Fundamental research and risk management
- The investment process is centered on bottom-up analysis that focuses on businesses’ fundamentals, such as strong financial and operational capabilities to grow earnings and cash flow, profit potential, robust management teams, and a proven track record of returning capital to shareholders.
- The team primarily focuses on companies with dividend yield > 0.5%, sustainability of dividend yield, historical dividend growth rate, sustainability of stock price, and opportunity for capital price appreciation.
- Risk management: Team emphasizes protecting against absolute loss over “engineering” portfolio construction relative to an index.
- Valuation is an integral part of the process. It serves as the second layer of risk management.
Strategic input
- The team recognizes that in some periodic environments, macro factors and strategic exposures are crucial. The top-down input can influence the relative defensiveness of the portfolio.
For more information on our equity capabilities
Risks
The value of the portfolio may fall as well as rise, and you may not receive back the amount invested.
As a class, equities carry higher risks than bonds or money market instruments.
Investments in small and/or medium-sized companies typically exhibit greater risk and higher volatility than larger, more established companies.
IBOR risk is the risk that changes related to the use of the London interbank offered rate (LIBOR) or similar rates (such as EONIA) could have adverse impacts on financial instruments that reference these rates. The abandonment of these rates and transition to alternative rates could affect the value and liquidity of instruments that reference them and could affect investment strategy performance.
Natural or environmental disasters, such as earthquakes, fires, floods, hurricanes, tsunamis, and other severe weather-related phenomena generally, and widespread disease, including pandemics and epidemics, have been and can be highly disruptive to economies and markets, adversely impacting individual companies, sectors, industries, markets, currencies, interest and inflation rates, credit ratings, investor sentiment, and other factors affecting the value of the Strategy’s investments. Given the increasing interdependence among global economies and markets, conditions in one country, market, or region are increasingly likely to adversely affect markets, issuers, and/or foreign exchange rates in other countries. These disruptions could prevent the Strategy from executing advantageous investment decisions in a timely manner and could negatively impact the Strategy’s ability to achieve its investment objective. Any such event(s) could have a significant adverse impact on the value and risk profile of the Strategy.
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