Concentrated Small and Mid-Cap Equity

Leading investor in a concentrated collection of outstanding businesses

Strategy Objectives

BBH’s Concentrated Small-to Mid-Cap Equity Strategy seeks to deliver attractive absolute returns over full economic cycles.
 
Investment goals
  • 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 S&P 500 and Russell 2000 indices after all fees and expenses, over a long-term period (5+ years)
 
Disciplined, long-term equity strategy
  • 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
  • Willing to hold cash reserves when opportunities are limited


  • Disciplined investment strategy

    i. Focus on durable businesses
    ii. Apply demanding investment criteria
    iii. Perform multi-faceted fundamental analysis focusing on company’s long-term wealth creation potential
    iv. Private equity approach to public equity investing

  • Deep fundamental research with strict investment criteria

    Purchase securities at a discount to intrinsic value.  

  • Concentrated portfolio 8-15 investments

    focused on small-mid cap North American and European public companies with market caps generally below $20 billion.

  • Seeking attractive absolute returns over full economic cycle

We take a private equity approach to public equity investing: deep due diligence, limited number of holdings, long term perspective.



Steve Werber MD and Portfolio Manager

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.
  • We are willing to hold cash reserves when opportunities are limited.

 

With a concentrated portfolio of holdings, we are able to bring a unique level of focus and depth to our research.



Ting Zhou VP and Investment Analyst

How to Invest

Our Concentrated Small & Mid-Cap Strategy can be accessed through a variety of investment vehicles. To learn more please contact a member of our institutional relationship management team.

 

Niamh Bonus

Senior Vice President
New York City, NY | USA

Niamh Bonus is the Equity Investment Specialist at BBH and a Senior Institutional Relationship Manager. In this role, Niamh is responsible for overseeing many of the firm’s institutional equity and…  Learn More

Our Team

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

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1BBH sponsors UCITS Funds registered in Luxembourg, in certain jurisdictions. For information on those funds, please see bbhluxembourgfunds.com


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