Investment Processes

Cornerstone Capital Management manages fundamental and quantitative long-only and liquid alternative equity strategies across multiple market capitalizations and styles including US, international, emerging, and global markets. With roots dating back to 1993, the firm has an extensive track record of successfully leveraging comprehensive and exacting research capabilities and consistent processes to deliver superior investment results for its clients. At the center of our firm is an uncompromised commitment to research, in all its forms: fundamental, quantitative, alternative, and thematic. Our teams of investment veterans combine proprietary research with prudent trading, awareness of influential global trends, and good peripheral vision of the positions of other market participants.

Growth Equity

The Growth Equity investment team seeks to provide outstanding performance through the opportunistic selection of a limited number of stocks expected to appreciate at a faster rate than the benchmark. These stocks are evaluated based on a variety of key factors where their research identifies one or more perception gaps (an underappreciated opportunity in one or more of the key factors). Stock selection is further based on the fundamentals of revenue, earnings, cash flow, and management depth and credibility. Sector allocation is a by-product of individual stock selection. Active trading around a core position is used in an effort to keep each portfolio constantly optimized for the rewards and risks present in the marketplace. As a result, risk is dynamically managed at the individual stock level and at the portfolio level. Our objective is to generate alpha over the long term by investing in high-growth companies where their research has identified one or more perception gaps.

International Equity

The International Equity team believes the best way to create value is to invest in sustainable growth opportunities. Through bottom-up analysis, the team of seasoned portfolio managers and analysts seeks to invest in reasonably priced companies with sustainable competitive advantages that can grow earnings regardless of the economic cycle. To identify such companies, the team quantifies long-term secular growth trends and those companies poised to benefit from them. They maintain a watch list of these companies, tracking their valuations, and waiting for opportune times to buy shares at reasonable prices. The investment team employs a very disciplined and rigorous buy and sell process that results in a rather concentrated portfolio containing high-conviction names and very little turnover.

Quantitative Equity

The Quantitative Equity team believes the key to investment success is adhering to a disciplined, transparent, and intuitive investment process that brings together the important elements of security analysis, risk management, and superior portfolio construction. While markets are generally efficient, inefficiencies can and do exist, creating investment opportunities and the potential to generate alpha. To exploit these opportunities, the team utilizes a multi-factor stock selection model to identify high conviction buy and sell ideas and builds a portfolio maximizing expected returns on a risk-adjusted basis. The team believes one size does not fit all – as such, investment models are customized to fit the needs of a specific strategy and closely monitored by the portfolio managers in order to identify and address any blind spots. The team uses innovative portfolio construction techniques and sophisticated trading technologies, resulting in predictable alpha generation for their clients.

Firm Expertise

At Cornerstone, our deep-rooted values set the environment for our team members to operate and serve our clients. We have earned and continue to earn our clients’ trust by operating at the highest levels of professionalism and integrity, by offering tremendous personalized service, and, of course, by striving to consistently deliver superior investment performance. Finally, we encourage each of our team members to be engaged, positive forces within their communities in order to sustain and enhance the world we live in.