Our goal is to generate the best return on investment for our clients.
The Cowan Absolute Return Fund is an equity-focused portfolio. It invests globally, is industry agnostic, and is not limited to large-cap companies. We believe this flexibility allows us to add only our best investment ideas to the Fund, without arbitrary rules limiting what securities can and cannot be held.
We take a long-term view of investing. Individual securities within the investment Fund are typically held for three to five years, and we partner with clients who share this long-term view.
Our investment process is one of true active management, not simply charging fees to approximate the holdings of an index. Portfolio holdings have few similarities with major indices compositions. We do not believe that money should be managed with relative performance in mind, but that absolute wealth creation and its sustainability are of the utmost importance.
As a result, we do not benchmark the Fund against any indices; rather, we measure our success by whether or not we increased our clients purchasing power.
This particular investment fund holds a concentrated selection of securities that are purchased at prices below estimated intrinsic values. We are steadfast in the view that purchases must incorporate a margin of safety the difference between our purchase price and the estimated intrinsic value of the security. This approach has traditionally been considered value investing. Investments typically held within the Fund include: temporarily out of favour securities, temporarily depressed free cash flow, hidden assets, and under-followed companies.
Equity diversification is important, but only to a point:
More isnt better when it comes to the number of securities in a portfolio.
The Cowan Absolute Return Fund diversifies by holding securities in a variety of countries and industries, not simply by adding more and more names.
The correlation of securities matters more than the sheer number of holdings.
Diversification is Important… Up to a Point
An equity portfolio holding 15 to 20 low-correlation securities eliminates nearly all unsystematic riskthe addition of more securities leads to unnecessary over diversification.
To help our clients get the best value in their investment management, we are committed to keeping our fees fair. We understand the impact that fees can have on the results of a long-term investment return, particularly in todays low-rate environment. Our unique relationship with Princeton Holdings allows us to pass on economies of scale savings to our private clients.
Charged at an annual rate of 5% of the gains the Fund generates.
Paid only if the high-water mark has been exceeded we dont charge a fee on gains that only serve to offset previous losses.
Charged as a percentage of the assets under management in each account. For example, if the value of an account was $100,000, and the management fee was 1.00%, then a fee of $1,000 per year would be charged.
Fees can have a substantial impact on return on investment. The dollar value of fees charged for investment services is often underappreciated by clients of asset management firms. Long-lasting client relationships are more important to us than collecting high fees one year at a time.
The portfolio with the1 & 5fee structure has a value that is$416,000higher than the portfolio with the2 & 20structure and$208,320higher than the average mutual fund.
Our goal is to generate the best return on investment for our clients. Where some investors believe the best way to predict future returns of potential investments is by looking at historical returns, Cowan Asset Management works differently.
Instead, we believe that the best way to predict future returns of potential investments is to evaluate their fundamentals. We believe an investment funds fundamentals relate to the asset managers investment approach: whether it is repeatable over the long-term, not whether it has had success over the short-term.
We believe that the best way to predict future return on investment is to evaluate the potential investments fundamentals. This relates to the asset managers investment approach: whether it is repeatable over the long-term, not whether it has had success over the short-term.
Cowan Asset Management does not chase performance by adding securities to our investment portfolios solely because they have been successful in the past. That is why we only partner with clients who believe in our fundamental investment approach.
We have partnered with industry leaders in the administration of the Cowan Absolute Return Fund in order to ensure that our clients enjoy not only the best return on investment but also the highest level of service from some of the most respected organizations in the industry.