Q & A with Jeff Kautz and Randy Hughes

Jeff Kautz and Randy Hughes co-founded Ballast Equity Management in 2016. More important to their clients may be the fact that they have invested together for over twenty years. Previously, the two worked together at Perkins Investment Management, a subsidiary of Janus Henderson Group, where Jeff held roles including Portfolio Manager, CEO and Chief Investment  Read more ➝

Ballast Equity Management, LLC Q1 2019 Strategy Commentary

Market Overview U.S. equity returns rebounded sharply in the first quarter of 2019.  Growth stocks outperformed value stocks and smaller companies generally outperformed the stocks of large-cap companies.  Within every equity style and size, low-quality stocks, as ranked by Standard & Poor’s Quality Rankings, sharply outperformed high-quality stocks.  An important step in the Ballast Equity  Read more ➝

Bill Driscoll has joined the firm

October 19, 2017 Oakbrook Terrace, IL – Ballast Equity announced today that Bill Driscoll has joined the firm as an Investment Advisor and Portfolio Manager. In this role, he will launch and manage the Ballast Unconstrained Value strategy and will assist clients with their asset allocation decisions across investment classes. Mr. Driscoll has 19 years  Read more ➝

A Valuation Framework for Beating Inflation and Creating Long-Term Wealth

We often see individual investors get stuck thinking of stocks as short-term trading vehicles. In our opinion, investors who consider themselves owners of companies rather than owners of stocks are more likely to be successful in reaching their goals. As owners, investors should not accept a return on their investment that is less than the risk-free rate plus an equity risk premium. Too often, people invest with long shot hopes of achieving short-term jackpot type returns. They forget the long-term goals of investing – beat inflation and create wealth.

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Competitive Advantage Period Defending Your Castle

“Companies that generate returns on invested capital greater than its cost of capital are instrumental in achieving long-term wealth for investors. Unfortunately, companies that create wealth eventually attract competition from other companies, ultimately driving down product prices and profit margins.”

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The Myth of High Beta

“Can investors forego short-term thrill for long-term reward?”

In a rational investment market, investors demand higher returns to compensate for higher risk. Therefore, one should logically expect lower returns from safer securities and higher returns from riskier securities. This has long been one of investing’s fundamental precepts. However, rational is not always an accurate description of investor behavior.

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Volatility – A Key Hurdle to Building Long-Term Wealth

If I lose 20% of my money this year, but I’m up 20% next year, I’m back to even, right?”

At first glance, this may seem correct, but it doesn’t accurately reflect the effect of losses on an investment portfolio. Understanding the difference between arithmetic and geometric returns and how they relate to portfolio value is essential to understanding what volatility means to your long-term investment success.

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