CSC Classic Value | All Cap

• Fundamental, bottom-up stock selection to an unrestricted, global universe.
• We consistently run computer screens to identify "fishing pools" of statistically cheap securities and highly desirable business models. We also draw upon a deep cumulative well of investment experience and industry contacts to identify ideas. Cove Street "team tackles" fundamental business model drivers, and establishes intrinsic value targets with a multivariate approach, incorporating discounted cashflow, historical valuation metrics, and private market and asset-based valuations.
• We pay careful attention to "management" and quantitatively review historical capital allocation decisions as well as Board composition and compensation structure.
• CSC Classic Value | All Cap holds 20 to 25 stocks in a portfolio, with a single security position not to exceed 10%. CIO Jeffrey Bronchick is responsible for the final portfolio decision. Sector weightings are a result of the bottom-up approach, with a 30% risk limit in any single industry.
• Less is more in regards to portfolio turnover, as experience has proven that the quality of decision-making decreases with frequency. That said, mistakes are made and our concentrated research assists in identifying errors relatively early. Stocks are also sold when their price no longer reflects a margin of safety, or we have identified materially better values in other stocks.