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Investment Process
| Stock Selection |
Portfolio
Construction |
Sell Discipline |
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ACM utilizes quantitative analysis to narrow our universe of securities to a list of potential investment candidates. We screen the universe for three general characteristics: size, growth and a catalyst that may propel future earnings.
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ACM utilizes qualitative analysis to evaluate the industry, quality of management, financial statement strength, and probability of a successful investment.
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Our proprietary research process continues with a review of a specific company's "market expectation". Market expectation consists of comparing Wall Street analysts' published reports, including models and industry fundamentals, to a company's management remarks, press releases, conference calls, SEC filings, models and business dynamics.
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We review companies for the following desirable characteristics: proven management team, well defined corporate strategy, rapidly growing company, leading and accelerating market share, solid revenue and earnings growth, insider buying or corporate buyback activity, and strong financial statements.
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Contrasting market consensus with ACM's proprietary research derives the "real story". We will perform a thorough cross check analysis and attempt to verify information that is gathered through competitors, suppliers, resellers, distributors and end users.
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After analyzing the necessary information, an opinion is formed as to whether the potential investment candidate will exceed Wall Street's expectations. This information is translated into a decision either to purchase the security, continue to monitor the price of the security for valuation purposes, or pass altogether.
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An ACM portfolio will hold between 45-65 securities with the initial purchase ranging between 1.5% and 2.5%. We manage position weightings and may let positions appreciate to as much as 6% of the total portfolio. Once a position approximates 6%, it wiill be trimmed to reduce the risk to the overall portfolio. We will also limit the ownership of any security to less than 5% of the outstanding shares of a company.
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