Investment Philosophy


We view buying a bond as lending money to a company. We look for bonds for which the market is mispricing risk based on our rigorous bottom-up credit research. We constantly assess relative value and dynamically adjust portfolios as risk-return profiles change. This allows us to compound attractive interest streams while avoiding defaults and credit impairments.

This approach may sound simple, but it is not one commonly adopted. Many investors do not view buying a bond as lending money to a company, but see it as buying a security for a short period of time in order to benefit from hoped for market appreciation. We call this “speculative lending.”


Our process is designed around our value lending philosophy and is based on 5 principles:

  • Build a deep understanding of the business model of the companies we lend to: evaluate products, competitors, suppliers, and customers.
  • Conduct proprietary quantitative analysis and stress test our investment assumptions for difficult environments.
  • Carefully review credit contracts and covenants.
  • Evaluate company management.
  • Construct highly liquid portfolios using best ideas to achieve the appropriate risk-return characteristics at a portfolio level.