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Small Cap 130/30
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Asset Class/Style:
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U.S. Equity / Long Short
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Portfolio Benchmark (See note):
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Russell 2000® Index
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Portfolio Assets:
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$305 MM as of 12/31/2010 |
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Additional Information:
The Small Cap 130/30 Opportunity
In what has become industry standard research ("Towards more Information Efficient Portfolios," Journal of Portfolio Management, Fall 2004), authors Roger G. Clark, Harindra de Silva and Steven Sapra, identify the benefits that can accrue to investment managers by removing the long only constraint and allowing the ability to make an active negative bet by shorting the equity.
THB was among the first fundamental small cap managers to offer a 130/30 strategy. It is our belief that the long track record of research driven alpha generation qualifies THB as an ideal candidate to capture both long and short opportunities in the small cap market in a well managed and risk controlled manner.
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Portfolio Structure
The structure of the product is built around the Small Cap Core long only portfolio as the base. The approach looks to increase the capital allocation to those companies within the long portfolio that possess the most attractive risk-adjusted return expectations. This additional capital allocation is financed from short opportunities identified during the research process.
THB's universe is comprised of those companies whose market capitalization is consistent with the range of the Russell 2000 Index. Portfolios are fully invested over most time periods. The long portfolio contains approximately 100 publicly traded common stocks. The short portfolio by design is also broadly diversified with 50-70 positions. THB does not employ the use of leverage, derivatives, convertibles, or options in the portfolio.
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An investment in smaller capitalization companies involves greater risk and price volatility than securities of larger, more established companies.
All Institutional product information has been provided by Thomson Horstmann & Bryant, Inc. Any questions about this material or requests for additional information should be made directly to the firm.
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