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Columbus Circle Investors Institutional Investment Expertise

Investment Philosophy

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CCI utilizes a growth oriented, investment philosophy of Positive Momentum & Positive Surprise which strives to invest in good companies getting stronger and in companies whose fundamentals are exceeding investor expectations.

Columbus Circle Investors is a bottom-up, growth-oriented equity manager and our strengths are like our investment philosophy, simple and straightforward.

CCI uses a four-step process. The first step is to identify 6-10 leading indicators for a specific company's business. The second step is to determine a consensus expectation for each of the leading indicators (you cannot measure fundamental surprise without understanding what is expected). The third step compares actual results to the expectations, with the objective of finding companies with positive surprise. Stocks whose collective businesses are experiencing momentum/surprise are considered attractive for purchase and companies falling short or in line with expectations are avoided or sold. The fourth step is to construct a diversified portfolio. We continuously monitor for changes in fundamentals and expectations.

New Ideas, Identify Leading Indicators, Determine Consensus Expectations, Compare to New Data, Construct Portfolio, and Monitor Continously

Step 1
CCI's analysts winnow down reams of information for each investment idea to 6-10 key factors, which are our barometers for an individual company's business performance. The leading indicators are identified from four areas affecting a given company - macro-economic, secular trends, industry dynamics and, most importantly, company specific factors. Several of the key factors may be shared amongst companies in a specific industry, but company specific performance will determine which investment is included in the portfolio.

Step 2
Defining the elements of information that the analysts identify as the key leading indicators is critical, but the building of consensus expectations for the leading indicators is equally important. CCI's analysts are trained to gauge expectations through contact with company management, competitors and suppliers, Wall Street analysts and the trade press/internet. The analysts build a consensus expectation for each leading indicator by asking each source what is expected. This information is placed in an electronic spreadsheet and stored in our firm's research database.

Step 3
For any particular set of expectations, there are interim events or pieces of evidence that will either reinforce those expectations or contradict them. Our analysts review relevant information and compare it to the set of expectations. When the information is better than expected, this is a buy candidate and when the information is equal or less than expected we sell or avoid if we do not own it. Our buy and sell criteria is symmetrical.

Step 4
We work to construct a portfolio of companies with Positive Momentum & Positive Surprise. The portfolio is diversified across investment themes (groups of stock sharing a common driver) and subject to client guidelines.

The process is continuous and we reset expectations based on new information and changes within the business fundamentals of each holding.

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