Strategy Objectives
- Achieve strong long-term, after-tax investment returns on an absolute basis
- Reduce likelihood of permanent loss of capital on any single investment
- Seek to deliver competitive returns as compared to the Mid Cap 400 and Russell 2000 indices after all fees and expenses, over a long-term period (5+ years)
- Focus on durable businesses
- Apply demanding investment criteria
- Perform multi-faceted fundamental analysis focusing on companies' long-term wealth creation potential
- Purchase securities at a meaningful discount to estimated intrinsic value
- Disciplined investment strategy
We take a private equity approach to public equity investing: deep due diligence, limited number of holdings, long term perspective.
Risk Management
We define risk as the likelihood of sustaining a permanent capital loss on any investment, and do not equate it with short-term stock price volatility.
We insist on a margin of safety in every investment. This exists when three risks are mitigated:
- Business risk
- Management risk
- Price risk
We evaluate material environmental, social, and governance (ESG) criteria as part our investment process and risk management framework. Learn More about Our Approach to ESG.
What Makes Us Different?
- We strive to invest in resilient businesses that can prosper in varying economic settings. Our investment process is not predicated on making macroeconomic projections.
- We are entirely bottom-up, conducting extensive qualitative and quantitative research, which integrates ESG factors into our due diligence process.
- “Friendly activism” – with significant ownership interest, we maintain frequent engagement with management.
- We promote a culture of humility, collaboration, constant learning, and peer review.
With a concentrated portfolio of holdings, we are able to bring a unique level of focus and depth to our research.
How to Invest
A margin of safety exists when we believe there is a significant discount to intrinsic value at the time of purchase. Intrinsic value is an estimate of the present value of the cash that a business can generate over its remaining life.
A less favorable ESG profile may not preclude the Adviser from investing in a company, as the consideration of ESG factors is not more influential than the consideration of other investment criteria. Considering ESG factors as part of investment decisions may result in the Adviser forgoing otherwise attractive opportunities, which may result in lower performance when compared to advisers that do not consider ESG factors.
The BBH Concentrated Small & Midcap Equity Strategy was previously called the Small-Mid Cap Equity Strategy.
This communication is for informational purposes only and does not constitute an offer or a solicitation to buy or sell any particular security or to adopt any specific investment strategy. The information herein has not been based on a consideration of any individual investor’s circumstances and is not investment advice, nor should it be construed in any way as tax, accounting, legal or regulatory advice. Any views and opinions are subject to change at any time.
Strategies are shown without regard to whether they are offered as separately managed account mandates or through pooled vehicles. Any discussion of or reference to any given strategy herein should not be taken as a recommendation or solicitation of any pooled vehicle which has an investment objective featuring or similar to such strategy.
This material does not constitute an offer or solicitation in any jurisdiction where or to any person to whom it would be unauthorized or unlawful to do so.
Risk Considerations
There is no assurance that a portfolio will achieve its investment objective or that the strategy will work under all market conditions. The value of the portfolio can be affected by changes in interest rates, general market conditions and other political, social and economic developments. Each investor should evaluate their ability to invest for the long-term, especially during periods of downturn in the market.
The Strategy portfolio may assume large positions in a small number of issuers which can increase the potential for greater price fluctuation.
Investing in small or medium sized companies typically exhibit greater risk and higher volatility than larger, more established companies.
The strategy may engage in option trading and hedging techniques which may magnify losses and increase the volatility of the fund.
Foreign investing involves special risks including currency risk, increased volatility, political risks, and differences in auditing and other financial standards.
NOT FDIC INSURED ● NO BANK GUARANTEE ● MAY LOSE VALUE
