The Provident Growth Fund seeks long-term growth of capital through a diversified portfolio of US stocks. The fund invests in mid-cap U.S. stocks with long-term annual high earnings growth and solid balance sheets. The fund is benchmarked against the Russell Mid-Cap Growth Index. The fund typically sells a stock when there is a perceived deterioration in fundamentals or the stock can be replaced with a more attractive stock. If a stock declines by 15% or more, the managers will review the investment thesis for the company.
The managers examine qualitative factors such as insider ownership, strength of management, sustainable competitive advantages, financial statement transparency, and balance sheet strength, to further understand the drivers that contribute to each business.
Security Selection Methodology
Market Cap Universe:
- $500MM – $15B
General Investment Mandate:
- Long only
- ADR ≤ 10%
- No one security can account for >10% of the portfolio
- Annual turnover ratio will be ≤ 50%, but, with the permission of the SIF instructor, can be >50%
- Cash ≤ 10%
- Sell if fraud is announced (or suspected)
- Russell Midcap Growth