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Individual Investors: Separate Accounts

As a registered investment adviser, HCM generally manages individual accounts in accordance with its philosophy of investing in strong companies when it seems their stocks are undervalued.

In general, HCM takes two approaches to managing these accounts.  In the first, it builds its Focused Advantage Equity Portfolios by purchasing in equal proportion the 20 securities held in its Focused Advantage Equity model.  Each stock represents approximately 5% of the total market value but no one industry may represent more than 25% of the total portfolio at cost.

In the second approach, to construct its Advantage Equity Portfolios, HCM purchases, in equal proportion, the 45 securities held in its Advantage Equity model.  Each stock represents approximately 2.2% of total market value, subject to the limitation that no industry may represent more than 10% of the total portfolio.

For both Portfolios, the "sell" discipline is similar:

  • Sell all shares if a portfolio holding fails the qualitative screen.
  • Sell all shares if the price of a security exceeds fair value by more than 20% using our quantitative measures.
  • Re-balance each holding to its target weight; for Advantage Equity, buying if its position is less than 1.5% of total market value and selling if its position exceeds 2.9% of total market value; for Focused Advantage, buying if its position is less than 2.5% of total market value and selling if its position exceeds 10% of total market value.

Qualified investors may participate with a minimum investment of $2 million.

For additional information on the Portfolios, contact us or see the Firm Materials section on this website.

HCM is also the investment adviser to a family of registered Mutual Funds.

 



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