Our Investment Approach is Powered by Experience
At TenSquared Investments we are client-focused. We offer investment solutions that reflect each client’s specific goals for capital growth and income, as well as their tolerance for risk. Our rigorous investment process, risk management expertise, and our over 100 years combined experience has produced award-winning results over several market and business cycles.
The cornerstones of our investment process are:
- We are passionate about investing
- We have always worked as a team, and always will do so
- Our conviction is evident in concentrated portfolios, and is a result of our diligent research efforts
- We are always accountable
- When our clients are successful so are we!
Theme Focused, Fundamental, Disciplined Investing
Our investment style is best described as Optimized GARP (Growth at a Reasonable Price). Growth is critical in defining success because a key reason for investing is to share in the wealth creation of the broad economy. However, it is important to employ a disciplined process that can identify great companies and great investments – our investment approach is focused on identifying opportunities that offer clients both these attributes.
Income is often an important investment objective for clients. Ideally, a portfolio’s income should grow over time so that purchasing power is protected. The income component also provides diversification and serves to temper portfolio volatility.
Client portfolios thus combine three key building blocks that allow for the customization to meet their investment goals in a tax-efficient manner: a growth component, an income component, and a low-volatility component that ensures sufficient diversification to manage overall risk. Our broad experience enables us to customize these building blocks to reflect client-specific objectives.
OUR INVESTMENT PROCESS
Fundamental research is at the core of our investment process. Valuation is an important consideration, but it is only one element in our decision-making. We work to understand the growth prospects for each business we analyze. Our process evaluates companies in the context of their industry, and the secular themes that will impact the broader macro-business environment. Understanding the industry dynamics helps us assess the likelihood of success for each firm’s strategy. This is central to our stock-selection process.
Step 1: Our Investment Universe is mid-large capitalization publicly traded companies.
Step 2: We identify businesses with strong management teams, sustainable competitive advantages, reliable cash flows, low financial risk, and above-average returns on capital. We then assess the valuation of these firms to determine their overall investment appeal.
Step 3: We consider the main themes that will impact the capital markets and industry sectors over the coming 18-24 months.
Step 4: We work as a team to identify those companies best suited to meet ‘growth’, ‘income’, ‘low volatility’ or other client-specific objectives.
Step 5: We construct a portfolio that reflects the client’s investment goals and risk tolerances. Working as a team ensures consistency in the portfolio construction process, and that each client benefits from our combined expertise. The resulting portfolio combines attractive valuations, strong business growth prospects and income, and provides sufficient diversification for proper risk management.
Step 6: Continuous monitoring and review of individual companies, and the overall construction of each client’s portfolio.