Institutional Investors :: Portfolio Construction

 

Portfolio Construction
Number of Investments/Position Size: The portfolio typically holds 40-60 securities and can be described as a “blended or core” strategy. We will significantly overweight certain stocks when we are highly confident in both the quality of the company and that we are entering a period of improvement in industry outlook, market position, competitive advantages, or valuation.

Willingness to Diverge from Industry & Sector Weightings: We will not compromise our stringent fundamental research criteria simply to adhere to specific market benchmarks when constructing a portfolio. We also typically avoid or underweight companies characterized as commodity producers, slow growth, highly competitive, or highly capital intensive.

Low Turnover: A result of our strategy (not the goal) is low turnover relative to our competitors.

Sell Discipline: Sales are typically made when a stock’s valuation is significantly higher than historical valuation and the overall market. Occasionally, we will hold a stock whose multiple has expanded to above average levels if we believe the long-term outlook has improved significantly. Sales will also be made if the long-term outlook has deteriorated, or if our research team uncovers a more compelling investment.

Thompson Investment Management, Inc. services involve the management of securities which fluctuate in value due to changes in securities markets, client preferences and other reasons. Thus, Thompson Investment Management does not guarantee any rate of return will be realized, or that losses will not occur, from receiving its services.