Dynamic Growth Equity Team

Tom Ognar: When we look for and manage growth portfolios, we're really looking for three characteristics: robust growth, sustainable growth, and, what we call, underappreciated growth. Let me expand on that. Robust growth, we want companies that are growing at least in the top quartile of their industries. That's on a revenue earnings cash flow basis. But we want that growth to be sustainable, not just at a certain part of the economic cycle or with a flash hit product. We're looking for what is sustainable about that growth hopefully over the next 5, 10, 15, 20 years. The key to us is marrying that with valuation. Our approach to valuation is trying to figure out what is that stock price missing about that sustainable growth going forward and the risk around that sustainable growth. And to us, to be a really successful growth manager over the long term, you need to marry all that together. If you're just looking at one end of the equation, you're not going to be able to be successful in up cycles and down cycles through the long market cycles for our clients. We really focus on what we do well, which is finding those dynamic growth companies, but also understanding the risk around those investments, managing that risk, structuring the portfolios to understand the various risks, and doing it in a diversified way. So, we're not growth investors at any price, but we're also not growth investors in just one or two sectors. We're not only looking at technology stocks. We're not only looking at biotechnology stocks. We've been able to find outperforming stocks in multiple sectors over time. I think that's one of the ways to be successful in managing risk as part of your process. The other area I should really hit on, which is core to what we do and gets ingrained in us when we join the team, is we have to be as good at selling stocks as we are at buying stocks. We should be thinking about, if we're doing our jobs correctly on a daily basis, is what is the opportunity cost? Are there better opportunities? And is that stock answering those questions of robust, sustainable, and under-appreciated growth? And if they're not, then they don't deserve to be in the portfolio. And it's our duty to move those stocks out of the portfolio. We actually go back and measure this over time. How do we do at selling stocks? How do we do relative to the underlying benchmark? How do those stocks we sell perform in the following six months? And one of the things I'm most proud of about the team is if you look back over history, we're very successful at that part of the decision-making process. I think a lot of time that gets lost by many growth investors. You get attracted to what's neat, what's high flying, and not as focused on making sure to manage the risk around that investment and, importantly, the risk around the portfolio.