Long/Short Equity

Boston Partners began managing long/short portfolios in 1997, shortly after the firm was founded.  We undertook this effort because long/short investing is a natural application of our research process which focuses on companies that comprise the tails of the valuation distribution.  Specifically our research focuses on companies that are undervalued on the left side of the distribution and companies that are overvalued on the right side of the distribution.

Our goal is to offer highly diversified, variable long/short portfolios that produce two independent, value-added streams of return.

Our Offerings

Total
Strategy
Mutual Fund Separate Account Offshore (UCITS)
Long/Short Equity $1,118 $1,118  –  –
Long/Short Research $7,075 $6,633 $442  –
Global Long/Short $1,679 $1,059 $620  –
Emerging Markets Long/Short $210 $62 $148
130/30 Large Cap $959  – $959  –

* AUM ($ Millions) as of 9/30/2017

Our Approach

  • A research-driven variable long/short strategy that focuses on security selection as the source of return
  • A value oriented investment process steeped in fundamental research
  • A fully invested long portfolio and a variably invested short portfolio
  • A diversified portfolio that is constructed exclusively through bottom-up security analysis
  • Long-term equity return objectives with reduced volatility and correlation to broad equity market
  • Significant personal capital investments from all investment principals

Short Process

Short portfolio holdings are intended to produce positive total returns. Short positions exhibit characteristics of failure in three risk areas:

  • Valuation risks, including high absolute and relative valuation multiples, weak or negative free cash flow, and high or rising capital expenditures, which may indicate overinvestment and excessive optimism on the part of management
  • Earnings risk, including profit margin pressures or unsustainable margins, flat or falling earnings estimates, and declining sales growth
  • Balance sheet risk, taking in high debt levels compared to earnings and cash flow, low cash balances and poor working capital or asset turnover trends

The Three Circles

Long positions are characterized by three criteria:
  • Attractive valuation
  • Strong business fundamentals
  • Improving business and earnings trends
Short positions are characterized by three criteria:
  • Excessive valuation
  • Poor business fundamentals and weak balance sheets
  • Deteriorating earnings trends, weak cash flow