We are differentiated from other asset managers in Korea as most of our investments involve company-specific special situations which are un-correlated with market or macro movements.
- Special situation events include: M&A, Spinoffs, Holdco/Opco events, preferred stock discrepancy, relisting, corporate governance clashes, negative operating/market news, etc.
- When such events happen, market may over-react to the news or miscalculate the impact of certain value-changing events, which will be the source of opportunity for us.
- Through all our research and investment process, we stick to the value investing philosophy.
We also tilt towards small to mid-end stocks as this is where institutional buyers hesitate to buy and we essentially compete with retail investors. Despite such preference, we also invest in large cap companies when there is clear opportunity.
Lastly, we tilt more towards long position vs. short position as the former set of ideas are usually sufficient to create a long term, uncorrelated market returns. But we selectively short to hedge out specific market/macro risks, which will help us boost investments during market downturn.