Our goal at Flagship, first and foremost, is the protection of client capital in real terms, followed by generating inflation-beating returns. To achieve these goals, we manage equity-centric portfolios, which, given sufficiently meaningful periods, offer the best opportunity for success. As active managers, we believe that the presence of several behavioural biases, amongst a number of other factors, lead to markets being only semi-efficient. This creates alpha-generating opportunities over both the short and long term.
To capitalize on these opportunities, we follow a flexible, unconstrained investment approach, which seeks to identify and take advantage of the best opportunities around the globe. We incorporate both bottom-up and top-down research when making investment decisions. Our style-agnostic approach is based on our belief that different macro environments will favour different investment styles. We utilise an active risk management process, designed to let our winners run for longer, cut our losses sooner and ultimately deliver through-the-cycle outperformance. This leads to well diversified portfolios which will not resemble the indices against which they are benchmarked.
Responsible Investing
Flagship invests in a diversified selection of global businesses with sustainable runways for growth. ESG considerations are integral to our investment process.
Key Characteristics of our Philosophy
- Dynamic, unconstrained approach. We are not constrained by traditional investment styles. We utilize a combination of fundamental, quantitative, and technical tools which aim to identify the best investment opportunities in any market environment. We achieve this through a flexible approach which allows winners to run while steering clear of large losses.
- Active risk management. We understand that risk and return are two sides of the same coin. Our risk management takes place at the individual stock level and at the portfolio level, where we embrace a strict selling discipline. We focus on understanding and accepting appropriate portfolio risks without sacrificing our ability to generate positive returns.
- We play to our strengths. As a boutique investment manager, being nimble is one of our greatest assets. It gives us the ability to rapidly move between positions and themes, without being constrained by market liquidity. We seek to fully exploit this agility, and are constantly on the hunt for new, more attractive investment opportunities.
- We are aware of our blind spots. No process is perfect, mistakes are guaranteed. Our selling discipline has been designed to offer protection against such mistakes by preventing any biases from clouding our investment decisions.
- We accept the wisdom of the market. We believe that the combined wisdom of the market is to be ignored at one’s own peril. Sentiment can, and does, remain positive or negative for much longer than it rationally should. We aim to use this to our benefit, while exploiting the semi-efficient nature of the market.
Risk Management in our Investment Process
At Flagship we utilise an active risk management strategy that seeks to remove emotion from the investment process, while also protecting against sources of unintended risk in the portfolio.
Our risk management strategy is based on a strict selling discipline, designed to limit large losses from any single position. We focus on evaluating the downside risk of every security in the portfolio. As part of our strategy, we may enter, exit and adjust position sizes multiple times for any given investment.
We furthermore reduce risk through portfolio diversification, currency diversification, position size targets and minimum liquidity thresholds.
What you can expect from us
At Flagship we follow a differentiated approach to investing. As active investors, we constantly scrutinise the risk/reward profile of all holdings in our portfolios, while remaining on the lookout for more attractive opportunities. Our active risk management strategy allows us to water our flowers and cut our weeds.
Markets can stay mispriced for prolonged periods of time. We are flexible investors who prefer to find the best opportunities given the prevailing market environment. The price paid for an investment determines its profitability. For this reason, when an investment moves against us, we will exit and, if warranted, re-enter at a better point in the cycle, should the thesis remain intact.
As dynamic managers, we know that some of our investment ideas could be much shorter-term in nature than others. As such, we expect a wide variance of holding periods for different investment cases. Given the strict adherence to our risk management strategy, our portfolio turnover may be higher than a buy-and-hold strategy.
We are in the business of protecting and growing our clients’ capital, not the business of being proved correct. Should the market environment change meaningfully, we will adapt our views accordingly.
What we can do for you
At Flagship we offer a high-touch service and a high-quality investment approach. We are professional but also approachable. We embrace the principle of simplicity, efficiency and reducing complexity to make sure our team is always looking for ways to find you more.
