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Investment Adviser
Kingsbury Capital
Kingsbury Capital
- Education Loyola University
- Qualifications BBA in Economics and Accounting
- Investment Experience 22 Years
- Founded 2007
Tech and Communications
This model concentrates on firms that are focused on Technology and Communications infrastructure and services. The companies that are selected for this model will have a wide range of market capitalizations, but typically have a minimum market cap of $1 billion, with no upside maximum.
We are looking for several types of momentum in our screen for candidates for this model. Business momentum includes increasing sales, earnings and balance sheet strength. Price/market-capitalization momentum includes an upward-sloping chart pattern. Put another way, we are not looking to try to "pick a bottom" with a security, nor are we looking for a sideways-trading security that may "break out."
We start our process by running an industry-comparative screen for firms that are in the model already - while also keeping tabs on firms that have been previously screened and possibly rejected in the past. We also look for profitable firms, firms that trade above $15/share, and firms that have a positive chart pattern. We will typically only act on issues that have several years of price data. Lastly, we try to avoid firms that have a legacy 'overhang' of price action from prior years.
We aim to maintain a number of positions, varying from a low of 20 to a high of 40. We feel that below 20 positions will generate additional concentration risk, while over 40 will dilute potential returns per idea. We feel that a sufficient market-capitalization diversity can also be achieved within that range of ideas.
Our closing methodology focuses primarily on downside price action, and action relative to the benchmark index (i.e. - underperformance). We typically stop a loss at a 20% loss; we will also typically look to 'trail-stop' from the issue's high-water-mark. (Note: The Covestor replication process does not consider stop losses or trailing stops when executing trades in subscriber accounts.) If a position experiences a negative fundamental event, we may exit before stops are hit. If we do not have an acceptable replacement security, the capital will move to a cash instrument. On the upside, we seek to maintain positions close to target weights - in other words, we will trim a position as it begins to move materially to the upside.
We have not always held to an absolute trailing-20%-stop rule (as it applies to profitable position management versus absolute loss management) - though we have not had many instances of such a situation. We have had a small number of 'sideways' positions that in retrospect could have been 'time-stopped' and applied the capital elsewhere. We are constantly seeking to refine our money-management disciplines to balance risk and return.
Model commentary
Kingsbury Capital's new Covestor model focuses on the Tech and Communications infrastructure field (IBM, SYNT, ACIW)
11 August 2011
firms that are in the Technology and Communications infrastructure and services industry. The companies that are selected for this model will have a wide range
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