We know that our long-term risk-adjusted investment performance is among the best in our peer group, according to the eVestment Alliance. It’s even better when one facts in survivorship bias, which removes from the rankings any funds that were shut down because of poor performance or other reasons. We also know that our commitment to own the equity of a concentrated number of the highest quality businesses with durable competitive advantages, robust returns on capital and healthy balance sheets is the foundation of our long-term investment success. In evaluating stocks, we have five key financial thresholds that we refer to as our “guardrails”.
With some assistance from our friends at financial information and analytics provider FactSet, we launched the “10,000 Portfolios Project” to see what we could uncover. This paper takes a closer look at how we went about constructing this study and the answers it revealed about concentration and quality.