Our Investment Philosophy
At Significance Capital, our investment philosophy is built on three core pillars: systematic alpha generation, earnings-driven analysis, and proprietary risk management. Our goal is to outperform our competitors on a risk-adjusted basis.
Our Philosophy
Investment Approach
Our disciplined approach focuses on generating alpha through carefully selected factor exposures and proprietary risk management during critical market inflection points.
Alpha Generation
We believe alpha is generated on the tails of the distribution with stocks that have higher than average factor exposures and that the two largest alpha generating factors over the long run have been price momentum and value.
Earnings-Driven Strategy
We believe earnings drive stock prices and that those companies which have the ability to exceed market expectations via earnings surprise/revisions offer the best ability to generate alpha over the long run.
Risk Management
Our proprietary risk models give us insights at major market turning points, the goal of which is to allow us to pivot aggressively to protect investors' capital. The interaction between the tails of the risk distribution in momentum and mean reversion are the primary drivers of our proprietary risk models.
Frequently Asked Questions
About Our Investment Approach
- What is Significance Capital's investment philosophy?
- Our investment philosophy is built on systematic alpha generation, earnings-driven analysis, and proprietary risk management. Our goal is to outperform our competitors on a risk-adjusted basis.
- Which factors guide the investment process?
- We focus on price momentum and value, combined with earnings surprises and revisions that may identify companies positioned to exceed market expectations.
- How does Significance Capital approach risk management?
- Our proprietary risk models are designed to identify major market turning points and help the team respond with the goal of protecting investor capital.
- Who manages Significance Capital's investment strategies?
- The investment team includes Ryan Isherwood, CFA, CMT, Founder, CEO, CIO and Portfolio Manager; Michael W. Klenn, CFA, CMT, Co-Portfolio Manager; and Dillon Hoover, CFA, Co-Portfolio Manager.
Technical trading models are mathematically driven based upon historical data and trends of domestic and foreign market trading activity, including various industry and sector trading statistics within such markets. Technical trading models, through mathematical algorithms, attempt to identify when markets are likely to increase or decrease and identify appropriate entry and exit points. The primary risk of technical trading models is that historical trends and past performance cannot predict future trends, and there is no assurance that the mathematical algorithms employed are designed properly, updated with new data, and can accurately predict future market, industry, and sector performance.