James River Capital is a firm that offers diversified financial services, and it is currently under the directive of CEO Paul Saunders. Also, the company provides other services such as third-party marketing for substitute investment assets.
This includes an extensive diversification of hedge funds program, the management of the long-only stock portfolio, which is divided into large-cap, mid-cap, and small-cap stocks. On a smaller scale, the company also manages other minor programs in different asset categories.
In his position, Paul spends a significant amount of time overlooking the main trading programs. To attain portfolio diversification, James River Capital has been operating the funds for funds program or over four decades. It is achieved through the collaboration of an IT specialist and two senior analysts who have over twenty years in the business.
Also, the firm has embraced opportunism as a business strategy. Case in point, James River Capital took an aggressive step of investing in various credit funds and distressed funds after the market collapse of 2008.
With managers riding over 100% after the sell-off in 2008, the company was able to ride this wave for several years until the position was cut back to zero. Over the past year, the company has devoted to building back its credit position as the value of the stock market increases.
With over forty years in the business, James River Capital has created a solid reputation and a diversified network of hedge fund managers. Even though the firm is smaller compared to most institutional investors, they can still access managers with untapped capacity.
Furthermore, James River Capital will bring on board lesser-known managers with an impressive record. According to Paul, his experience in the industry has horned his interviewing skills and expertise during the selection process.
Over recent years, tech stocks have proved to have remarkable markets caps with spectacular performance and are tough competitors. However, since the company is value-oriented and fixated on consistency in earnings and revenues, there is not a lot of tech stocks on the company’s portfolio.
By systematically screening thousands of stocks, the company purchases the cheapest that rank top-25. Cheapness is determined based on price to earnings divided by growth and price per earning. Stock is kept until it shows deterioration, then it is sold and replaced.
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