As an active manager who holds individual securities, we seek to minimize downside risk while providing sustainable, long-term growth.
Growth At a Reasonable Price (GARP) represents a blended approach which combines the tenets of growth investing and value investing to identify individual securities.
Turnaround Companies By paying careful attention to the creative destructive cycle associated with innovation and the economic cycle, Blue Point seeks to add value for clients.
Cash is used as an asset class to lower portfolio volatility. Cash is opportunistically used to take advantage of behaviorally-driven mispricing that occurs from time to time in the equity market.
Example of the Blue Point Investment Strategy at Work
A key tenet of Blue Point's active management strategy is to lower volatility. You may ask, how can that be since equity markets are, after all, volatile? Blue Point uses cash as an asset class. In rising equity markets Blue Point tends to sell. This leads to underperformance and risk reduction at the top of an equity market cycle. By taking profits at the best of times, there is a store of value that can be converted to equity ownership at more favorable prices. Does this strategy always work? No, portfolio insurance can come with a cost in a rising market. The historic value-add of this risk reduction has been powerful. For example, following the collapse of Bear Sterns, Blue Point exited financial service stocks. Fifteen days prior to the Lehman bankruptcy, Blue Point had a 28.9% cash position. During 2008, Blue Point dramatically lowered client exposure to market volatility, and, as a result, outperformed the total return of the S&P 500 by 820 basis points.