The team focus on analysing three key factors when looking to invest in stocks on either side of the book:

1. Investment cycles. The team analyses each position within the context of capital, business and credit cycles and the sustainability of current trends within companies and industries
2. Change themes. Monetise either change or sustainability when it is not correctly priced by investors. The team look to profit from a security’s mispricing – which is typically created when investors do not accurately understand change or sustainability in an industry or company’s business model
3. Secular winners and losers. In the long book the team seek to identify companies/sectors with sustainable above trend growth and barriers to entry. In the short book the team look to identify companies and sectors with growth challenges and declining returns

The stock selection philosophy is a core part of a highly disciplined investment process that Mike Corcell has developed over 15 years. Research is strictly limited to those companies where the business model can be clearly modelled and understood and the team does not invest in credit related financials, pharmaceuticals or bio-technology stocks.

The portfolio is typically comprised of between 60-70 mid to large cap stocks and the team does not seek to invest in small caps, futures or indeed any derivative or basket product other than options. Furthermore, the short book is always made up of stock positions which actively seek to add value rather than dissipate or hedge risk.

The gross and net exposure of the portfolio is aggressively managed with the aim of controlling risks and mitigating drawdowns by rapidly reducing exposure in periods of market stress.