|Philosophy | Strategies | Investment Team | Podcasts | Blogs|
Cambridge seeks companies building long-term economic value. These companies tend to have three characteristics:
- Management aligned with shareholders – Through compensation schemes and/or a large share ownership position, these management teams are paid to drive shareholder value over the long term.
- Strong capital allocation – Management has demonstrated the ability and willingness to allocate capital in the best interest of shareholders, be it investing internally, making acquisitions or returning capital through dividends and share repurchases.
- Competitive Advantage – Companies have a strong competitive franchise, or "moat" around their business, a durable franchise and are well positioned for the future. We seek to avoid "value traps."
This conservative bottom-up approach involves intensive fundamental analysis using a variety of techniques that examine the "value" and "growth" characteristics of a company, while taking into account higher-level economic considerations. The team looks for attractive investment opportunities in all geographies, market cap sizes and across the capital structure.
In addition to these core holdings, Cambridge aims to take advantage of shorter-term opportunities created by mispricing in the market. Depending on a fund's flexibility and risk profile, a portion of the portfolio may be invested in companies where the following holds true:
- Information edge – A situation where we believe the market has mispriced or misunderstood a given security.
- Industry in which we have experience – Each member of the team has expertise in specific industries. We aim to leverage that expertise.
- A path to value creation – Understanding how, why and when the value will be realized is critical.