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Essex seeks to identify companies with accelerating earnings and revenue growth before the market is able to reflect this change in stock prices. Rigorous fundamental analysis helps determine a very important strategic blend of both "Sustainable" and "Dynamic" Growth companies.
Essex's proprietary research effort is the cornerstone of their stock selection. The team conducts original research using sources beyond a company's management and develops financial models and target prices for stocks.
Investment Process
Ideal Investment
The ideal investment will enhance the portfolio's very important strategic blend of "Sustainable" and "Dynamic" growth companies, which are characterized as follows:
Sustainable Growth Companies: This is the "core growth" portion of the portfolio made up of companies that show:
- Sustainable competitive advantage
- Consistent financial performance
- Attractive financial returns
- Strong market position
Dynamic Growth Companies: Generally companies that have:
- Emerging technologies or services
- Powerful agents of change
- Rapid and/or accelerating growth
- Improving financial returns
Portfolio Construction
In constructing the portfolio, portfolio managers and analysts will:
- Identify stocks whose growth profiles merit further review. Starting with a universe of roughly 1000 companies and through a process of discovery and evaluation both portfolio managers and analysts are responsible for generating ideas for the portfolio.
- Evaluate through in-depth fundamental research. Analysts focus on identifying an inflection point in a company's revenue and earnings growth. Active coverage is maintained on roughly 150 - 200 companies.
- Recommend candidate companies. Analysts focus on the sustainability of revenue and earnings growth.
- Construct and make buy/sell decisions. Portfolio managers are the ultimate decision makers and determine the appropriate balance between "sustainable" and "dynamic" growth.
- Monitor and continuously evaluate all stocks in the portfolio.
Sell Discipline
Essex ensures that only the highest conviction ideas remain in their portfolios. A stock will be sold when:
- The investment thesis has played out and the stock is no longer attractively valued
- A better relative investment opportunity is identified
- There is anticipation of investment thesis failure
- Confidence is lost in company management
Disclosure Investors should carefully consider the fund's investment objectives, risks, charges, and expenses before investing. For this and other information, please call 800.835.3879 or download a free prospectus. Read it carefully before investing or sending money.
The performance shown represents past performance and is not a guarantee of future results. Current performance may be lower or higher than the performance data quoted. The investment return and the principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. From time to time the advisor has waived fees or reimbursed expenses, which may have resulted in higher returns. The listed returns and yields on the Fund are net of expenses and the returns and yields on the indices exclude expenses. Current performance of the Fund may be lower or higher than the performance quoted.
There is no guarantee that these investment strategies will work under all market conditions, and each investor should evaluate their ability to invest for a long-term, especially during periods of downturns in the market.
The investment return and the principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost.
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