Our strategy is based on the insights gleaned from our fund manager’s massive data analysis project and the validation derived from his application of these insights in his previous fund and research business. The strategy is executed by using deep research and quantitative analysis to identify stocks that are priced based on fundamentally flawed expectations.
Our approach is commonly regarded as a contrarian investing style as we invest directly against the consensus. These contrarian stocks are highly idiosyncratic, which means their price is largely determined by company specific factors (microeconomics). This significantly reduces the effects of changes in the broader stock market, which is driven by macroeconomic factors.
We use this approach to construct a portfolio of 12-15 uncorrelated contrarian stocks that each exhibit the pattern that we have found high return investments possess. We only invest in stocks that have overwhelming evidence supporting price movement in excess of 75% within a 12-18 month time period.