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strategy > The strategy invests in a portfolio of entrepreneurial companies with market caps above $5B. We select investments based on our 15 proprietary qualitative and quantitative lters. Our investment style places high value on visionary leaders who are stewards of their companies and possess high economic and non-economic stakes. approach > The rm utilizes a bottom-up fundamental approach to identify investments in companies that possess 15 entrepreneurial attributes. Our extensive academic research and eight years of professional performance assert that companies possessing these characteristics are likely to outperform non-entrepreneurial companies over time. benefit > Investing in companies based on our core fundamental characteristics will provide the foundation to build a high conviction portfolio that generates strong alpha and upside capture. Our equities perform especially well during positive economic cycles.
strategy details
Strategy AUM No. of Holdings $40mm 27
equity characteristics
P/E Mkt Cap (median) 50.46 45.2B
manager perspective
25.61
482.50
15 10
.85 .21
1.14 -
The investment strategy applies academic research by Dr. Joel Shulman, Professor of Entrepreneurship at Babson College. Professor Shulmans 20+ years of analysis asserts that organizations which emphasize entrepreneurial culture, organic growth, and aligned compensation trump corporate bureaucracy on a regular basis. Entrepreneurial leaders keep their organization costs lean, debt levels manageable, and expansion projects within reach. Many have built their companies from inception and therefore have a vested interest in utilizing resources efciently. Their interest in success is often both economic and non-economic, which often translates into superior returns for shareholders.
Alpha (%)
3.91% 2.53%
12.89% 10.51%
55.29% 32.39%
29.47% 16.18%
43.84% 17.94%
25.61% 7.17%
Past performance does not ensure future results, and there is no assurance that the Entrepreneur US Large Cap Strategy will achieve its investment objectives. Returns are presented gross of management fees, net of brokerage commissions and include income from interest and dividends as well as capital gains. The returns do not reect custodial fees or the deductions of taxes a typical investor may accrue. The management fee for the Entrepreneur US Large Cap strategy is .65% annually.
Q4 2013
15 entrepreneurial traits
1 Organic Growth Opportunities 2 Above average ownership stake among key stakeholders 3 Low SG&A 4 Above average return on invested capital 5 Sustainable growth 6 Manageable debt 7 Active strategic alliances/ partnerships/licensing 8 Aligned executive compensation packages 9 Low executive turnover 10 Transparent governance 11 Long duration of key managers 12 Low or no dividends 13 Family involvement 14 High EBITDA margin % 15 Other signicant stakeholder relationship
Utilities
30%
11% 7%
33%
disclaimers > EntrepreneurShares is an institutional asset management firm and is registered with the SEC as an investment advisor. The Entrepreneur US Large Cap Strategy (the Strategy) contains portfolios invested in equities with market capitalizations above $5B exclusively within the US. The benchmark is the S&P 500 index. Performance data of the index was obtained from publicly available sources. From inception (7/31/2005) through December 2013, the Strategy represents the US long only performance extracted from the EntrepreneurShares Global Equities composite as well as cash allocation of 2% based on the intention to be fully invested. Investment returns include realized and unrealized gains and losses and dividends. The index is not directly comparable to the performance of the Strategy because the index is not actively managed and represents a more broadly diversified mix of equity securities. The presentation of this index data does not reflect a belief by EntrepreneurShares that the index is an investment alternative to its strategy. The document has been prepared solely for the informational purposes of prospective advisory clients. By accepting this document, the recipient acknowledges that all of the information contained herein is confidential and may not be used for any purpose other than for discussions with EntrepreneurShares regarding its advisory services. The information contained in this document is provided as of specified dates. EntrepreneurShares has no obligation to update, supplement or correct any information in this document, although it reserves the rights to do so. This document does not purport to be allinclusive or to contain all of the information that a prospective advisory client may deem necessary to make its decision to engage EntrepreneurShares as an investment advisor. These past performance numbers have been confirmed by Spaulding Group through 7/31/2013.
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