Objective

We believe that investing in high quality international small caps with strong cash flow sustainability, wide EBITDA margins and attractive valuation will produce a superior investment portfolio. We believe that these stock characteristics, coupled with portfolio construction using balanced exposures, will produce high portfolio consistency and superior long-term returns. We seek to construct a balanced portfolio of high quality international small cap stocks that deliver superior long-term returns. The strategy also seeks to outperform the MSCI EAFE Small Cap index over the long-term.

Period Q2 2019 YTD 3 year ITD
Return 2.4% 13.1% - 6.84%

Strategy and Process

The portfolio consists of thirty-six stocks in seven equally weighted sectors. The strategy seeks to reduce volatility through its sector diversification and by eliminating exposure to higher risk areas of the international space such as micro caps and emerging markets. We believe that the strategy’s balanced approach to portfolio construction, added to its quality and value focus, will provide greater consistency of returns. The portfolio uses a disciplined and repeatable approach. The strategy has low trading costs due to limited turnover.

Highlights

  • Relative to the benchmark the portfolio exhibits:
    • Strong Balance Sheets
    • Higher Absolute Dividend
    • Higher Margins
    • Stronger Cash Flow
  • Beta of 0.68 since inception

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