The Two Point Investment Approach is based on the synergy created when the concepts of value and quality are both applied to investing. To qualify for a Two Point Portfolio, companies must have the qualities most relevant to long-term growth—qualities recognized and rewarded over time by investors—and be selling at a price below their current value.
The approach incorporates a careful and detailed analysis of the myriad factors that determine a company’s quality and value. This approach means we can consider a broad range of securities investments. We are not limited by the strict style biases found within firms pledging to invest only on the basis of growth, or momentum, or value, or high quality.
In our search for investment opportunities, we consider companies in all industries, and companies considered to be small, medium, or large capitalization.
As a result of our broad approach—including a balance of industries and market capitalizations—and our long-term focus, we believe that the benchmark most appropriate to our performance is a full market cycle of the Russell 3000 Index.
Using strict quality metrics, we then narrow down the list of opportunities to begin thorough research on each viable candidate.
Our research is “bottoms-up” or company-specific, analyzing each potential investment individually. We assess the relationship between each stock’s value and quality as we make determinations about whether to include it in client portfolios.
Once a stock has been added to the portfolio, we continuously evaluate its value/quality relationship. Although any stock in the portfolio is one we would be comfortable holding for the long term, we do not hesitate to replace it with a stock with a superior value/quality relationship.
We also maintain a steady assessment to keep an optimum relationship between value and quality at the portfolio level.
At Two Point Capital Management, we offer our clients three investment strategies, depending on their objectives and risk tolerance. Which of the following strategies is most appropriate for you? Contact us.
Each of our investment strategies is built on the Two Point Approach, which considers both value and quality.
As a result of the simultaneous focus on valuation, quality and portfolio composition, cash positions are “frictional.” Money market holdings are not targeted to be a certain percentage of assets managed, but are the result of a management process focused on the more important aspects of the portfolio.
As a result, money market holdings, like equity holdings, may change rapidly and with significant swings.