What makes Thompson Davis asset management unique?
We can answer in three words. We think differently.
When value opportunities meeting our fundamental criteria are scarce, we don't buy stocks for the sake of being invested.
It can be tempting to stray from an investment discipline and attempt to profit during times of euphoric trading of stocks with little or no earnings or by chasing the "hot" stock of the day with the crowd.
However, we believe consistency in our investment strategy and reasonable valuations lead to better long-term returns.
With a grounded perspective gained from buy side and sell side experience, we stick to our discipline in good times and bad.
We will wait to invest in companies meeting our criteria with quantifiable downside risks and upside rewards.
How does Thompson Davis Asset Management fit with the rest of my investments?
Our asset management program is focused on aggressive growth and trading of capital and should be used for the client's growth oriented assets.
We are considered an "all-cap" value-driven manager because of our flexibility to invest in the full spectrum of stocks from small-cap to large.
Our main focus continues to be in the small and mid-cap area due to the higher growth potential.
We believe the potential for higher returns commensurate with a higher level of risk is greater for the companies meeting our value criteria than any other place in the domestic equity marketplace.
We believe investors in our strategy should have a long-term time horizon of at least 3-5 years.
How do you pursue a strategy of preserving capital and seeking higher returns?
While growth of capital is our goal, our discipline allows us to hold cash and/or short-term bonds.
When we believe it is appropriate, we can choose not to participate during what we believe are unfavorable market conditions or times where we are unable to find companies meeting our criteria. We usually maintain a cash position in our portfolios to take advantage of opportunities when they present themselves.
Each stock position is managed separately and according to its own ever-changing risk/reward profile.
We choose to own more of a company's stock when we feel it is undervalued and less to none as the stock approaches what we believe is fair value or becomes overvalued.
We realize being "a great company" is not the most important criterion for investing, the price you pay for the company's stock will ultimately determine your return. Valuation is the key.
We choose to wait for "value" to improve returns.
How do you get paid?
We employ a transaction-based fee where we are paid for putting your capital to work.
Due to our active management, transaction fees are frequently discounted from the traditional full-service fee schedules.