Investment Philosophy
Our objective is to deliver investment outperformance consistently by extracting alpha in a clear and intentional manner.
We believe how we implement our investment philosophy is best expressed by ”Grinold’s Fundamental Law of Active Management*” – Skill, Breadth and Efficiency..
The risk-adjusted outperformance (or “information ratio”) of an investment strategy depends on three factors:
Skill: the accuracy of investment forecasts
Breadth: the number of independent times that skill is applied per year
Efficiency: the amount of skill that makes it into the final portfolio after constraints and transaction costs
In simple terms – our objective is to find an investment edge (skill), use it often (breadth) and use it wisely (efficiency).
*Grinold, Richard C.1989, ”The Fundamental Law of Active Management” Journal of Portfolio Management, vol.15,no.3 (Spring):30-37. Richard Grinold is also a founding shareholder of Vinva Investment Management.