INVESTMENT STRATEGIES
Our Philosophy
Denali’s investment philosophy rests with the fundamental premise that superior long-term results can be achieved with a systematic process that eliminates cognitive biases and subjective weaknesses that negatively impact many investors.
We compare the core of our philosophy to a well understood investment principle that involves the value of networks, and more recently, social networks. For example, the value of Facebook’s platform increases as more users join and actively use the network. Our Network Value approach to investing simply means that in a stock’s case, its liquidity (or size of network) should be factored into its value and expected return forecast. Most of our peers may ignore liquidity until portfolio construction. Our research shows that liquidity, or the size of the stock’s network, is a key component to its value and is often underappreciated.
What We Have to Offer
We offer institutional and high net worth investors equity strategies covering value, growth and income oriented approaches in U.S., Global, Emerging and Frontier markets. While we adhere to strict risk management rules, we believe in high conviction investing, high active share, and concentrated portfolios relative to a traditional systematic manager.
Value Strategies
Investment Objective
The Denali NV Micro Core investment strategy is measured against the Russell Microcap Index, and seeks to return 2-4% gross excess above benchmark.
Benchmark
Russell Microcap
Key Strengths
- The fundamental equity valuation insights from Denali Advisors published and unpublished research
- A time varying factor forecast designed to capture investment themes
- Fundamental inputs to a systematic approach
- Emphasis on high earning stocks that possess low (but increasing) liquidity and low market cap leads to exposure to stocks our peers may ignore
Key Data *
Excess Return Objective: 2-4%, Gross of fees
Tracking Error Objective: 5-7%
Typical Market Capitalization: $50 Million – $1.5 Billion
Approximate Holdings: 70-120
* This key data is the strategies objectives; however, the actual results may vary due to market impacts.
Investment Objective
The Denali Network Value Small investment strategy is measured against the Russell 2000 Value Index, and seeks to return 2-4% gross excess above benchmark.
Benchmark
Russell 2000 Value
Key Strengths
- The fundamental equity valuation insights from Denali Advisors published and unpublished research
- A time varying factor forecast designed to capture investment themes
- Fundamental inputs to a systematic approach
- Emphasis on high earning stocks that possess low (but increasing) liquidity and low market cap leads to exposure to stocks our peers may ignore
Key Data *
Excess Return Objective: 2-4%, Gross of fees
Tracking Error Objective: 4-6%
Typical Market Capitalization: $200 Million – $3 Billion
Approximate Holdings: 80-120
* This key data is the strategies objectives; however, the actual results may vary due to market impacts.
Investment Objective
The Denali Network Value Mid strategy, measured against the Russell Midcap Value Index, seeks to return 2-4% gross excess above that benchmark.
Benchmark
Russell Midcap Value Index
Key Data *
Excess Return Objective: 2-4%, Gross of fees
Tracking Error Objective: 4-6%
Typical Market Capitalization: $1-$15 Billion
Approximate Holdings: 60-100
* This key data is the strategies objectives; however, the actual results may vary due to market impacts.
Key Strengths
- The fundamental equity valuation insights from Denali Advisors published and unpublished research
- A time varying factor forecast designed to capture investment themes
- Fundamental inputs to a systematic approach
- Emphasis on high earning stocks that possess low (but increasing) liquidity and low market cap leads to exposure to stocks our peers may ignore
Investment Objective
The Denali Network Value Large investment strategy is measured against the Russell 1000 Value Index, and seeks to return 1-3% gross excess above that benchmark.
Benchmark
Russell 1000 Value Index
Key Strengths
- The fundamental equity valuation insights from Denali Advisors published and unpublished research
- A time varying factor forecast designed to capture investment themes
- Fundamental inputs to a systematic approach
- Emphasis on high earning stocks that possess low (but increasing) liquidity and low market cap leads to exposure to stocks our peers may ignore
Key Data *
Excess Return Objective: 1-3%, Gross of fees
Tracking Error Objective: 3-5%
Typical Market Capitalization: $30-100 Billion
Approximate Holdings: 50-60
* This key data is the strategies objectives; however, the actual results may vary due to market impacts.
Growth Strategies
Investment Objective
The Global Core Growth investment strategy seeks to provide long-term capital appreciation from exposure to global equities in both developed and emerging markets which our investment discipline has identified as having accelerating growth rates.
Benchmark
MSCI AC World Index
Inception Date
October 1, 2010
Investment Objective
The Global Growth ADR investment strategy seeks to provide long-term capital appreciation from exposure to global stocks, in both developed and emerging markets, which our investment discipline has identified as having accelerating growth rates.
Benchmark
MSCI AC World Growth Index
Inception Date
July 1, 1998
Investment Objective
The Non-U.S. Growth ADR investment strategy seeks to provide long-term capital appreciation from exposure to non-U.S. stocks which our investment discipline has identified as having accelerating growth rates.
Benchmark
MSCI AC World Ex USA Growth Index
Inception Date
October 1, 1995
Investment Objective
The U.S. Large Cap Growth investment strategy seeks to provide long-term capital appreciation from exposure to U.S. large cap growth stocks that our investment discipline has identified as having accelerating growth rates.
Benchmark
Russell 1000 Growth Index
Inception Date
April 1, 1995
Investment Objective
The Middle East, Africa & South Asia (MEASA) investment strategy is a unique opportunity to invest across the diverse, but difficult to access, MEASA region with no exposure to China. The strategy provides a liquid investment in publicly-listed stocks and seeks to deliver an attractive risk-adjusted return with low correlation to global markets.
Benchmark
MSCI Emerging Markets Index
Inception Date
May 1, 2018
Income Strategies
Investment Objective
The Liquid Private Credit investment strategy seeks to provide concentrated exposure to private debt and equity through investments in Business Development Companies. This asset class offers low correlation to standard U.S. equity benchmarks and can provide an attractive yield.
Benchmark
S&P BDC Index
Inception Date
January 1, 2015
Footnote
Strategy also known and marketed as Business Development Company
Investment Objective
The U.S. Equity Income investment strategy seeks to provide exposure to stocks with dividend growth and sustainability, while seeking to provide an attractive yield and moderate capital appreciation.
Benchmark
N/A
Inception Date
January 1, 1991
Investment Objective
The Diversified Income investment strategy seeks to provide clients with a diversified portfolio of equity and fixed income assets, while seeking to provide yield and long-term capital appreciation. Asset allocation can include equities, fixed income, commodities, alternatives, and cash.
Benchmark
N/A
Inception Date
January 1, 2021
