67 WALL STREET, New York - January 22, 2014 - The Wall Street Transcript has just published its current Value Investing and Other Strategies Report. This special feature contains expert industry commentary through in-depth interviews with highly experienced Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.
Topics covered: Small Cap Investing - Value Oriented Strategy - High-Quality Companies - Upside in Small-Cap Stocks - Bottom-Up Stock Selection - Portfolio Diversification with Closed-End Mutual Funds - High-Grade Fixed Income Securities - Sector Rotation Investing
Companies include: Apple Inc. (AAPL), Ultra Petroleum Corp. (UPL), First Acceptance Corp. (FAC), Merck & Co. Inc. (MRK), Dell Inc. (DELL) and many others.
In the following excerpt from the Value Investing and Other Strategies Report, an experienced special situations portfolio manager discusses his methodology and top picks for 2014:
TWST: Please begin with an overview of the Roumell Opportunistic Value Fund and a snapshot of its history.
Mr. Crawford: We pursue out-of-favor, overlooked or misunderstood securities. We believe, almost by definition, that's an area of the market that has less competition, where mispricing is more likely, so our ability to add value is more likely. Within that subset of securities, we seek out the strongest balance sheets. To the extent possible, we want to take the risk of permanent impairment of capital off the table.
We do deep primary research; we travel to see companies. We have a number of relationships that we've cultivated over the years, who have a long history of experience within certain industries, who we consult with to help us to better understand certain situations.
Lastly, we are opportunistic, and that opportunistic quality is maybe the most important piece of our strategy. We have the flexibility to invest in companies of any size, in any sector and anywhere in the capital structure. Ultimately we're looking for value, and if we can't find value, we remain in cash. Our cash balance has varied widely over our 15-year history; it's been as low as zero, and it's been as high as 45%.
In terms of the history of the firm, it was founded by Jim Roumell in 1998, so we have a 15-year track record employing the strategy in separate accounts, and in 2011 we launched our mutual fund, which follows the same strategy.
TWST: What was your cash position like in 2013?
Mr. Crawford: We began the year at 19% cash, and we ended the year at 45% cash. So we are now matching our all-time high in cash, and it's really a function of - a number of holdings basically reached our estimates of intrinsic value, so we were net sellers over the course of the year...
For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.