Cernocky

Investment Philosophy

Our primary focus is the long-term preservation of capital while seeking to compound capital at above-average returns over a full market cycle. We invest globally across the market cap spectrum – seeking opportunities to purchase high-quality stories with growth traction.

We are looking for investments that fulfill the following criteria:

• Have long term revenue growth potential
• Have strongly committed management that genuinely cares about its customers, employees and is dedicated to developing the business
• Have a business model which is hardly imitable by competitors (competitive advantage) and is able to further deepen this advantage

We abide three main principles:

• Stay within our circle of competence
• Keep things simple. Rationality and common sense is key
• Concentrate capital in only the best ideas

Additionally, we follow a research-intensive, concentrated strategy which generally consists of 7-15 core positions. The strategy is long-biased, however we may occasionally short individual companies with highly asymmetric risk-reward characteristics. Additionally, we’ll hold large cash positions and have the ability to use derivatives to hedge broader market tail-risk during periods of market excess.