ACM Investment Philosophy

Our investment philosophy is to exploit market inefficiencies by investing capital in a limited number of investments at a discount to conservatively-estimated intrinsic value.  

Equity Approach

We look for companies with attractive long-term prospects, strong fundamentals, and superior management teams. 

Over the long term, we believe the market will reward companies that drive earnings and cash flows growth over time.  Over the near and medium term, we believe the market is inefficient and can be wildly so.  This is especially true in smaller, underfollowed, illiquid stocks.  Information and liquidity inefficiencies in small and mid-cap stocks provide the opportunity to buy companies at attractive prices.  Small companies have a long history of outperforming larger companies over the long term.

Why have smaller companies outperformed over time?

Research attributes it to the 'Small Firm Effect', which suggests that smaller companies:

• Achieve higher earnings growth due to their smaller base;
• Tend to be under-followed by Wall Street analysts;
• Tend to be avoided by the average investor as they are viewed 'riskier'; and,
• Are typically run by entrepreneurs with incentive to maximize shareholder value.

Through rigorous fundamental analysis and disciplined stock selection, we believe these inefficiencies can be exploited to offer the best opportunity for attractive investment returns over the long term.

Balanced Approach

Our balanced approach combines our equity philosophy with investments in undervalued, income generating fixed income securities.  The philosophy believes diversification will provide investors with upside potential (stocks) while mitigating downside risk (bonds).  This strategy is customized around each investors risk tolerance.