The firm’s focus is on identifying quality companies with enduring businesses that are well managed as well as demonstrating good governance and sustainability. The emphasis is on large capitalization companies with steady cash flows. After these are identified, the main criteria for stock selection is proper valuation.
We use internal fundamental research to properly identify and value equity candidates which meet our investment criteria. Internal research is supplemented by some external research products and services. The firm invests for the long-term and avoids short-term speculation. Portfolio turnover is low which results in less trading expenses and taxes.
As a risk control measure, all equity research is funnelled through our weekly investment meeting which is attended by all investment professionals. We utilize this process to ensure that the firm’s investment philosophy is adhered to and to properly vet new ideas.
Coerente Capital Management’s fixed income style is an extension of the equity research process. As such, the firm places an emphasis on the direct purchase of corporate bonds and preferred shares in order to maximize yield. Aggressive interest rate anticipation strategies are strictly avoided.