Sheets Smith Profile

Sheets Smith Investment Management

ABOUT US

  • Founded in 1982  
  • Employee Owned and Operated. 
  • CIO & Founder: Cornell Bowden
  • SEC – Registered Investment Advisor
  • Roughly $120 mil million under supervision* as of 12/30/2019
  • Strategies: Absolute Return Balanced,   
  • Houston, TX  
  • Contact: Cornell Bowden (336) 765-2020

 

Philosophy

We believe Active Tactical Asset Allocation is essential for long-term investment performance and reduction of volatility.

“Investment policy…explained on average 93.6% of the total variation in actual plan return… Total return to a plan is dominated by investment policy decisions.” 1

To outperform the market you have to be different than the market.

  1. We believe Earnings Growth creates shareholder wealth in the long run.
  2. Positive Earnings Revisions contribute to better stock performance.
  3. We add value by: • Optimizing the Asset Allocation based on risk and potential return profiles • Identifying companies with above average performance potential through a proprietary, systematic process of fundamental and technical analysis • Avoiding large equity losses, especially in down markets

 

Absolute Return Balanced Portfolio:

  • Unique Tactical Asset Allocation 
  • Disciplined Stock Selection
  • Evade Equity Losses 
  • Long-term Performance Record

The Absolute Return Balanced Portfolio offers conservative investors a disciplined investment product that optimally balances risk and potential return across the economic cycle. The process achieves above average returns with reduced risk by moving relatively overvalued assets into relatively undervalued assets in a timely, disciplined manner and with strategic equity selection. It is far more profitable not to lose money than to have wide variations in returns. This process manages risk through the tactical asset allocation process and assuages large stock losses by selling aberrant stocks, typically caused by negative changes in fundamentals or by severe bear market corrections. A distinguishing attribute of this strategy is that a large portion of the portfolio may be allocated to cash in uncertain markets and major market declines. Over the course of the history of this portfolio, stocks have been as low as 25% of the portfolio (and for very brief periods even lower) and as high as 100% of the portfolio, but the latter is also infrequent. The optimal mix between equities and bonds at any point in time is based on the expected returns of these assets and their recent historical volatility. The asset allocation process successfully reduced stock exposure prior to the market declines of October, 1987 and by March, 2000, the beginning of a severe bear market. The equity selection process selects companies with above average earnings growth and that are reasonably priced. Over the years, this system has performed competitively in most market conditions, but it especially adds value during serious market corrections. The universe of stocks is all publicly traded stocks listed on major exchanges in the United States