Investment Philosophy

Our Overall Mission

The mission at Granite is to apply prudent, time tested principles to the investment process. We seek consistent growth and preservation of capital in order to obtain the highest returns consistent with the investment objectives and risk tolerance of each client. Our goal is investment excellence.

 

Investment Process

The investment process is a fundamental, bottom up and research-driven approach seeking to invest in high quality companies with superior business models exhibiting a catalyst for positive change, which may result in rapid growth in earnings and revenue and discretionary free cash flow. Significant emphasis is placed on prudent and visionary managements with past records of success that act in the best interest of shareholders.

 

High Quality Investing

For years we have developed a variety of investment strategies that seek growth of capital from investments in what we believe to be high-quality companies. We define high quality companies as those which have management that have demonstrated a past record of success, those we believe exhibit superior business models and a strong catalyst which is expected to drive gains in discretionary free cash flow, revenue and earnings and returns on invested capital. The goal: to find a company where we strongly agree with management’s vision of how to grow the company and sustain its competitive advantages for the long run. In short, we seek companies that we can consider “partners” in our efforts to build wealth for our clients.

Fundamental Bottom-Up Research Process

We believe the greatest way to add long-term value for our clients is from thorough, fundamental, bottom-up investing and having superior knowledge of the companies in which we invest. We also believe the best way to generate excess return is primarily through security selection not sector rotation or trying to time the market.

Independent Research

Investment excellence is not only about industry and company knowledge, but more importantly about independent thinking and challenging conventional wisdom. Original research is the core of our investment process and all portfolio managers are also analysts. Each member of the investment team is responsible for researching and recommending investment ideas.

Catalysts for Positive Change

The market is often slow to recognize how change will benefit some businesses and undermine others. By investing early and at the right price in companies positioned to benefit disproportionately from change, we may lower our clients’ acquisition cost. This also maximizes the potential for capital appreciation as the market comes to recognize the dynamics of change.

The Importance of Consistency

Having a consistent investment process and controlling risk through varied markets is critical to long-term success. In our view, disciplined portfolio management is the business of generating incremental returns which are the result of many careful investment decisions which may produce consistent results year after year; not substantial out-performance in one year followed by severe under-performance the next. Our goal is investment excellence.

Risk Control

Granite believes that disciplined portfolio management is the business of generating incremental returns which are a result of many careful investment decisions. Having the necessary controls to monitor risk in a portfolio is critical to long-term success.

Performance

We believe successful portfolio management is a result of consistent results year after year; not substantial out-performance in one year followed by severe under-performance the next. Our goal is investment excellence.

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