The aim of the strategy, which has been a specialty of Connors since our founding in 1969, is to provide returns greater than those of large company stocks. We define a “small company” as any publicly traded company with an equity market value between $500 million and $2 billion, though purchases may include companies down to approximately $250 million. Companies in which we invest are evaluated using a fundamental, bottom-up approach. Our search begins at the company level, where we scrutinize financials, the management team, competitive strengths and weaknesses, and return potential. Small company candidates are typically discovered through research conferences, regional and independent firm research, and in-house database screening. Our efforts result in a relatively concentrated portfolio of 25 to 30 holdings across the majority of economic sectors and a diversity of industries.
- High potential return asset class
- Exposure to less efficient market
- Long-term firm and manager experience
- Not appropriate for everyone since returns may be volatile