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Equity Investments

US Large Cap Structured

Philosophy

DuPont Capital believes that stocks are regularly mispriced due to investors’ overconfidence or overreaction to short term events such that strong, relative, risk-adjusted returns can be achieved by systematically identifying companies with sustainable earnings power, trading at reasonable valuations, as stock prices generally follow business fundamentals over the long term. To implement this investment philosophy, DuPont Capital designed quantitative models to replicate the insightful, forward-looking approach of a fundamental analyst within a systematic, objective process.


Process

Within the Large Cap Structured Equity strategy, DuPont Capital utilizes normalized and near-term earnings expectations, free cash flows and sustainable earnings growth to assess a stock’s value relative to its price. A quantitative model efficiently screens the investable universe to identify stocks that represent the strongest relative value within their industries through a combination of valuation, quality and momentum characteristics. DuPont Capital seeks to create a risk efficient portfolio of stocks underpriced relative to companies’ long-term intrinsic value as supported by sustainable, high quality earnings and realistic cash flow expectations. The portfolio construction process balances buy/sell recommendations of a portfolio optimizer tool with qualitative, experienced judgment developed through company-specific analysis.