How are we different?
According to a Morningstar report, a majority of U.S. equity funds underperform their benchmark over 10 years. If you ask us why, we think it’s pretty simple: many firms have a similar strategy. We saw this firsthand across our prior professional experiences and believe to outperform the market, you need to differentiate. At CBC, we integrate our proprietary stock strategy into our overall asset allocation, which we customize to all client types.
Our concentrated and equal-weighted stock strategy provides unique exposures to underappreciated businesses with winning cultures. Based on our analysis of millions of data points, we have observed culture’s significance to business performance and longevity.
Our asset allocation approach primarily relies on passive investing where we believe clients can reach their financial objectives with fewer fees and tax implications while better understanding their investments.
“It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change.”
- Charles Darwin
In our view, without adapting one’s investment techniques, outperforming the market becomes incrementally difficult.
The Importance of Culture
We believe the best investments over time have come from a combination of successful business models, high-quality products and services, and consistently improving financials, which all stem from the people in a company. From the executive team to the introductory roles, we think the best companies to invest in are filled with a talented and driven workforce, creating a winning culture and ultimately leading to high performing stocks over time. With this in mind, we have taken culture, a hard to quantify theme, and built a scoring methodology to define an investable universe.
Source: Coast Bridge Capital, December 31, 2024
The culture score is a proprietary metric created by Coast Bridge Capital, which uses publicly available data to quantify and rank the strength of a company’s internal culture. Returns have been bucketed by Culture Score — the A-Rated bucket represents the highest score, the F-Rated bucket represents the lowest score. See the ‘Disclosures’ page for more information.
Within our defined universe, we begin with a top-down approach in which we screen for the most competitively sound businesses in the most attractive industries. We continue with bottom-up research and analysis to identify businesses that exhibit sustainable growth, improving profitability, and high-quality fundamentals.
First Build a Foundation
While stock picking is core to CBC, building a plan that best meets client objectives and addresses risk tolerance is driven by asset allocation. We balance our experiences as advisors and analysts to provide professional advice on financial planning and portfolio structure. Our customized portfolios are low-cost, tax-efficient, and simple. In the complex world of personal finance, we take pride in helping clients become comfortable in understanding their investments.