Our Global equities capabilities

Research shows that the compounding of cash flows explains the majority of long-term total returns. Therefore as the market becomes increasingly focused on the short term, understanding the long-term fundamental drivers of cash flows provides us with an exploitable edge. Only companies that we assess as being able to profitably and reliably grow their cash flows year in year out, and for a long period of time, will earn a place in our portfolio.

Wealth creation for us is the consistent generation of high and sustainable returns over and above all costs, including the full opportunity cost of borrowing capital from equity investors. Competitive advantage, capital allocation, and growth are the three key pillars that support stable, solid wealth creation, and a sustainable investment case. In addition, we only want to invest in what we believe are exceptional companies that can sustain cash flow compounding throughout the economic cycle.

Decisions are tied to our philosophy and absolute risk and return objectives. We think in terms of total returns and seeking to preserve capital. Decisions will not be constrained by benchmark, peer group, geography, or
sector-relative considerations. In line with our philosophy and process, company fundamentals and the ability to efficiently diversify our cash flow exposures are the main determinants of our long-term positioning. 

We believe in the power of a collaborative small team. By operating in a collaborative environment, supported by shared beliefs, we achieve better investment outcomes and help mitigate individual biases. Our experience and empirical evidence tell us that small teams of expert investors, with commonly-held beliefs, are better placed to deliver a more consistent application of investment principles over time.