GRT Topaz Strategy

Long/Short U.S. Equity Strategy from GRT Capital Partners, LLC

The investment objective of the GRT Topaz Strategy is to achieve superior total returns while minimizing the probability of permanent impairment of capital by primarily investing in publicly traded equity securities deemed to be undervalued. To help preserve capital, especially in periods of generally falling stocks prices, GRT Capital will also take short positions in companies deemed to have worsening business fundamentals or deteriorating competitive positions. To help increase returns, GRT Capital may employ financial leverage, through margin borrowing or in other ways, when it deems such action to be appropriate. While the GRT Topaz Strategy focuses primarily on U.S. equities, it may also invest in non-U.S. securities.

In implementing the strategy, GRT Capital uses an investment technique which involves multiple investment strategies. Each strategy represents a grouping of investments which have particular characteristics in common, for example, a group of “turnaround stocks” or a group of “discounted sum-of-the-parts” companies. The use of multiple strategies provides a framework that divides the larger investment strategy into smaller, discrete parts which can be managed tactically.

Another investment technique is the use of a “farm team” of selected companies for investment consideration. In this approach, an investment in a company often begins as a relatively small position, and increases in size as confidence grows and the original investment thesis for the security is tested. Based on the performance of the “farm team” position, investment in the security may be increased or decreased thereafter.

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Rudolph K. Kluiber
Gregory B. Fraser
Timothy A. Krochuk