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B. G., Opalesque Geneva: The LRT Economic Moat, a portfolio of high-quality companies, has been shining so far this year and displaying a favourable approach to investing in today's equity markets.
The strategy invests in a concentrated portfolio of companies with durable competitive advantages, i.e. "moats", purchased at attractive valuations, and held for the long term.
The manager focuses on moats, management and long-growth runways - all three are sources of perpetual inefficiency and mispricing. The strategy is 40-60% beta-adjusted net long and comprised of a portfolio of 40-50 long names which are hedged with four to six market index short positions.
"April was a good month for our strategy," says LRT founder and portfolio manager Lukasz Tomicki in a monthly report to investors seen by Opalesque. "We made money on both our hedges, which declined, and on our longs which rose slightly during the month. I remain cautiously optimistic for the rest of the year, even though we are now entering the seasonally worst part of the year (May to late October). I see our portfolio as being very conservatively positioned."
The manager continues to expect economic and stock market weakness ahead, but this has little consequence as he does not make short-term investment decisions based on macroeconomic sentiments.
Since its inception in October 2012, the strategy has outperformed the S&P 500 and the Russell 2000. It returned 6.6% in April 2023, 34.6% ...................... To view our full article Click here
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