INSTITUTIONAL INVESTORS & CONSULTANTS
 

A. Investment Philosophy & Risk Management

Investment Philosophy

Curran Investment Management's institutional equity portfolios seek to generate returns above their respective benchmark Russell equity indices over a full market cycle with less risk. This is accomplished by purchasing and owning the stocks of high-quality companies within the appropriate market capitalization ranges with the intention of holding them for the long term. There are different set ranges for the number of stocks held in each Curran portfolio, please see the Institutional Fact Sheets below. Each market-cap-specific portfolio is designed to deliver superior downside protection while fully participating in market rallies. The All Cap Equity portfolio invests in stocks with superior financials and rapid earnings growth which have the greatest stock price momentum.

For all four market-cap specific portfolios, focus is placed on companies that meet high quality standards criteria in earnings growth, return on equity, balance sheet strength, earnings retention, and possess a minimum number of years of public financial data (the latter varies by the target market cap range of the portfolio). The three market-cap specific portfolios can best be described as “core” style, but as they emphasize those sectors that demonstrate a history of consistent growth, the weights reflect Curran's modest growth tilt.

The investment approach is fundamental after a proprietary, multi-factor front-end analysis is used to narrow a starting universe of stocks. In the long run, stock prices are most correlated to the fundamentals and profit growth of the underlying company. This has been the conclusion of many academic studies over time. Companies with stronger financials, especially those with robust or improving balance sheets, offer the best opportunity at the lowest relative risk to deliver ongoing growth in earnings.  The philosophy and approach of all Curran portfolios are unchanged from their inceptions.

Risk Management  

Risk management is accomplished through the use of portfolio construction control parameters. Portfolios are diversified among most sectors, emphasizing those sectors that have demonstrated a history of consistent growth. The maximum allocation to any one sector is the greater of 30% or 1.5 times the benchmark sector weight. The minimum sector allocation is half (0.5 times) of the benchmark sector weight in the large sectors, and zero in the smaller sectors.

The weights of single stock positions are capped at various maximum percentages of the portfolios. The strategies that have the lowest number of holdings have the highest allowed individual position sizes in percentage terms (see links to portfolio fact sheets below). Curran does not look to time the market, and portfolio turnover is relatively low in the 3 market-cap-specific portfolios. Portfolios remains fully invested at all times, with the cash position never exceeding 5%. As measured by standard deviation, the three market-cap specific portfolios have been successful in risk mitigation as they have experienced lower volatility (less risk) than their respective benchmark indices over most time periods since inception.

B. Curran Investment Management Institutional Summary

Firm Inception:                                              2004

Firm AUM (12/31/16)                                      $305M

Institutional AUM (12/31/16)                      $40M

Staff                                                                    12

C.  Institutional Product Descriptions & Fact Sheets

Core Growth Equity

The Core Growth portfolio seeks to generate returns above the benchmark Russell 1000 index over a full market cycle with less risk. This is accomplished by purchasing and owning the stocks of 20 to 25 high-quality, large-sized companies (those possessing market capitalizations greater than $5 billion) with the intention of holding them for the long term. The portfolio is designed to deliver superior downside protection while fully participating in market rallies.

Companies considered for the portfolio have these characteristics: consistent earnings growth and an EPS growth rate of at least 10%; return on equity of at least 15%; strong balance sheet with the debt/total capitalization ratio not exceeding 35%; and a minimum of 10 years of public financial data.

The inception date of the Core Growth portfolio is June 30, 1998. All results are GIPS-compliant and independently verified since inception. The investment approach is fundamental after a proprietary, multi-factor front-end analysis is used to narrow a starting universe of about 900 stocks to roughly 270 names. The philosophy and approach of Core Growth are unchanged from its inception.

CORE GROWTH FACT SHEET

 

Mid Cap Core Growth Equity

The Mid Cap Core Growth portfolio seeks to generate returns above the benchmark Russell Mid Cap index over a full market cycle with less risk. This is accomplished by purchasing and owning the stocks of 25 to 30 high-quality, mid-sized companies (those possessing market capitalizations ranging from $2 billion to $12 billion) with the intention of holding them for the long term. The portfolio is designed to deliver superior downside protection while fully participating in market rallies.

Companies considered for the portfolio have these characteristics: consistent earnings growth and an EPS growth rate of at least 10%; return on equity of at least 15%; strong balance sheet with the debt/total capitalization ratio not exceeding 35%; and a minimum of 5 years of public financial data.

The inception date of the Mid Cap Core Growth portfolio is September 30, 2003. All results are GIPS-compliant and independently verified since inception. The investment approach is fundamental after a proprietary, multi-factor front-end analysis is used to narrow a starting universe of about 1,000 stocks to roughly 175 names. The philosophy and approach of Mid Cap are unchanged from its inception.

MID CAP FACT SHEET


Small Cap Core Growth Equity

The Small Cap Core Growth portfolio seeks to generate returns above the benchmark Russell 2000 index over a full market cycle with less risk. This is accomplished by purchasing and owning the stocks of 35 to 40 high-quality, small-sized companies (those possessing market capitalizations up to $2 billion) with the intention of holding them for the long term. The portfolio is designed to deliver superior downside protection while fully participating in market rallies.

Companies considered for the portfolio have these characteristics: consistent earnings growth and an EPS growth rate of at least 10%; return on equity of at least 15%; strong balance sheet with the debt/total capitalization ratio not exceeding 35%; and a minimum of 3 years of public financial data.  

The inception date of the Small Cap Core Growth portfolio is September 30, 2003. All results are GIPS-compliant and independently verified since inception. The investment approach is fundamental after a proprietary, multi-factor front-end analysis is used to narrow a starting universe of about 2,800 stocks to roughly 145 names. The philosophy and approach of Small Cap are unchanged from its inception.

SMALL CAP FACT SHEET 
 

All Cap Equity

The All Cap Equity portfolio is a concentrated quantitative all-cap equity strategy which seeks capital appreciation from investments in the common stocks of U.S. and multinational companies with superior financials and rapid earnings growth that have the greatest stock price momentum. A proprietary, multi-factor front-end analysis is used to narrow the starting universe of about 4,700 stocks across the large-, mid-, and small-cap market cap ranges to roughly 525 names. Companies considered for the portfolio must have all of these characteristics: consistent earnings growth and an EPS growth rate of at least 10%; return on equity (ROE) of at least 15%; strong balance sheet with the debt/total capitalization ratio not exceeding 35%; and a minimum of 2 years of public financial data. All Cap Equity-eligible companies must have 2 years of public data and 1 year of minimum ROE and EPS growth.

A price momentum overlay is then applied, and those stocks whose relative strength is at least in the 80th percentile are selected for the next step. The current price of each of the approximately 30 stocks is compared to their 50- and 200-day moving averages, and names whose prices are above both averages are eligible to be purchased, pending a check on company fundamentals and data integrity.

Risk in the 20-to-25 position portfolio is further mitigated by portfolio representation in all 3 market cap tiers within set ranges and adherence to a strict sell discipline. The philosophy and approach of the All Cap Equity strategy are unchanged from its inception on February 29, 2012. All results are GIPS-compliant and have been independently verified since inception.

ALL CAP FACT SHEET


D.  Institutional Investment Professionals
      
Click on a name to view their bio.
 

CEO, Portfolio Manager, Investment Committee Member
 

CIO, Portfolio Manager, Investment Committee Member

 

Trader
 

Regulatory Liaison