Our approach is to invest in stocks demonstrating growing valuations within a rigorous risk management framework. We aim to outperform benchmark indexes by a sizable margin while acknowledging market realities and the constraints imposed by market conditions.
The investment approach rests on four pillars: Market Conditions, Stock Selection, Risk Management, and Disciplined Investing, all geared toward generating and enhancing consistent investment returns over the long term.
Given the uncertainty of market conditions, investing requires careful consideration. We let the markets be our guide and invest when conditions are favorable. Our models and rules contribute to navigating market dynamics and allow us to calibrate our portfolio exposure accordingly.
Our quantitative-driven stock selection models evaluate companies across various parameters. The process narrows down potential candidates to a ranked list of promising investments. We select stocks for the model portfolio based on additional rules and criteria, and positions are equally weighted at the time of investment. We allow winning positions to grow, which can lead to some positions carrying a higher portfolio weight over time.
We employ a layered approach to risk management, which includes market indicators, portfolio diversification to reduce company-specific risk, position size limits, and closing out underperforming positions. However, sharp losses in individual positions cannot be avoided, particularly in more speculative industry groups and market segments like biotechnology and small caps. Our approach to mitigating losses and focusing on total portfolio returns contribute significantly towards overcoming drawdowns and recording positive portfolio returns.
Wealth building requires discipline and patience. Discipline is vital in systematic investing and executing our quantitative model and rules-based system. Adhering to our system, even in periods of market turmoil and underperformance, assists in managing behavioral tendencies and is crucial for long-term success.
Graycell Advisors, and its affiliates, officers, employees, families, and all other related parties, collectively referred to as ‘Graycell’ and/or ‘we,’ is a publisher of financial information, such as the Prudent Small Cap, Prudent Biotech, and Prudent Healthcare newsletters. We are not a Registered Investment Advisor (RIA). Historical performance figures provided are hypothetical, unaudited, and based on our proprietary analysis and system performance, back-tested over an extended period. Hypothetical or simulated performance results have limitations, and unlike an actual performance record, simulated results do not represent actual trading and consequently do not involve the financial risk of actual trading. The performance results obtained are intended for illustrative purposes only. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Past performance is not indicative of future results, which may vary. All stock and related investments have a degree of risk, which can result in a significant or total loss. In addition, the biotech industry and small caps are characterized by much higher risk and volatility than the general stock market. Information contained herein is general and does not constitute a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual investors. If you decide to invest in any of the stocks of the companies mentioned in the newsletters, samples, alerts, etc., sent to you or available on our websites, you can and may lose some or all of your investment. You alone are responsible for your investment decisions. Use of the information herein is at one's own risk. We are simply sharing the results of our model. Nothing should be construed as a recommendation or an offer to buy or sell any securities, and we are not liable nor do we assume any liability or responsibility for losses incurred as a result of any information provided or not provided or not made available on time, herein or on our website or using any other medium. We cannot guarantee the accuracy and completeness of any information furnished by us. We may or may not have existing positions in the stocks mentioned in our reports. Our models are proprietary and/or can be licensed and can be changed or revised based on our discretion at any time without any notification. Subscribers and investors should always conduct their due diligence with any potential investment and consider obtaining professional advice before making an investment decision.
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