Our Portfolio
OUR AIM is to assist clients create wealth through equity investments whilst always aware of the need to preserve wealth. Significant losses from not actively managing the risks embedded in portfolios can greatly destroy the ability to continue to compound wealth over time. This asymmetrical, absolute risk and return approach to investing aims to capture the upside volatility from share prices whilst minimising downside outcomes. We prefer clients to hold residual cash, delay or defer capital deployment, rather than ‘dead weight’ index positions and overlay active risk and return exposures to help manage key value drivers.
ALIGNING our interests with our clients, our 25+ years of history of portfolio construction and implementation exhibits our tax-aware style that results in a consistent focus on after-tax wealth creation and capital preservation.
OUR BELIEF is to hold a diverse range of securities within a concentrated portfolio. Security ideas are simply the working capital of portfolios. The selection, blending, monitoring and managing of those ideas are crucial to capturing portfolio returns at acceptable levels of risk. Consequently we suggest weighting each stock according to your own risk & return profiles of wealth creation and not according to a single factor such as the market-capitalisation weight of an index or a static asset allocation framework.
OUR PORTFOLIO WEIGHTINGS are simple yet structured. Appropriately, each business model investigated starts with an equal opportunity to create wealth for our clients. We are never constrained by index thinking.
OUR PREFERRED EXPOSURES are generally held within three tiers of weighting:
- Confidence Tier I
- Confidence Tier II
- Confidence Tier III
AS RISK MANAGERS, WE MAY OVERLAY or advise to overlay, the core security specific portfolio with a select number of hedging exposures. This overlay is part of our active, asymmetric risk process and provides improved execution of preferred value drivers, and or hedging of unwanted risks. Portfolio leverage is always at the sole discretion and execution of the client.
OUR ASSESSMENT OF PORTFOLIO RISKS includes a range of factors. In harmony with our ROSE OAK philosophy of appropriately blending the art and the science, the quantitative and the qualitative, we assess risk with regard to both the probability and the consequences of a range of outcomes. Understanding known and unknown variables and managing uncertainty rather than mere gain or loss is at the heart of our risk process.
OUR ABILITY to separate portfolio risks from business risks (as an independent owner-operated investment company) allows us, and thus our clients, the time and patience that is critical in capturing value from volatility and uncertainty.
OUR INVESTMENT STYLE is best suited to those who can take equity-like investing horizons (i.e. minimum 3-5 years). As such this generally suits principals or those with the investing patience to contract to longer-term agreements and therefore benefit from, and not panic during, volatility.
