The H-Factor – Know the Number
Investors impound vague and ambiguous information into their investment decisions, decoupling stock prices from their underlying fundamentals. This leads to loss.
Applying an actuarial-based approach, we developed a proprietary risk metric to avoid this behavior. It’s the H-Factor. This measure calculates the probability the company will fail to deliver the growth implied by its stock price.
Using the H-Factor as the foundation of our investment methodology, we can apply these probabilities to any portfolio or investment universe. We build portfolio solutions that aim to provide a dramatically differentiated and uncorrelated source of outperformance by simply avoiding the losers – overpriced stocks caused by human behavior.