In a couple of weeks, about 25 Marquette finance students and Dr. David Krause will visit Daruma Asset Management in New York City. Daruma invests in a high-conviction portfolio of no more than 35 small-cap stocks. The firm is 100% employee-owned and manages roughly $1 billion for public and corporate pension plans, endowments, foundations and individuals.
AIM program director, Dr. Krause said, "We are looking forward to visiting Darmua again. Mariko, Patty, Neal, and everyone else at the firm rolled out the red carpet for us. We enjoyed the opportunity to talk with them about their investment philosophy and process."
Krause continued, "I think they have one of the best monthly investment newsletters in the business. I encourage my students to read these regularly. They are very insightful in understanding the small cap fundamental investment process. Mariko Gordon and her team do an outstanding job in discussing various investment topics each month."
AIM program director, Dr. Krause said, "We are looking forward to visiting Darmua again. Mariko, Patty, Neal, and everyone else at the firm rolled out the red carpet for us. We enjoyed the opportunity to talk with them about their investment philosophy and process."
Krause continued, "I think they have one of the best monthly investment newsletters in the business. I encourage my students to read these regularly. They are very insightful in understanding the small cap fundamental investment process. Mariko Gordon and her team do an outstanding job in discussing various investment topics each month."
Daruma practices true active management by owning only their most compelling ideas. They buy stocks with the potential to go up 50% or more over the next two years, with a reward-to-risk ratio of three to one. How have they done?
Their strategy has resulted in outstanding long-term performance with average annual portfolio turnover of 40%. Daruma's small cap composite performance net of fees annualized since inception [07/28/95 to 06/30/10] has been 11.7% versus 6.3% for the Russell 2000 index.
By the way - what is a Daruma? Daruma (dah-ROO-mah) was a fifth-century Indian monk who reached China after a perilous three-year sea voyage and became the founder of Ch'an (Zen) Buddhism. He is said to have trained the warrior monks of the Shaolin temple in Kung Fu, crossed the Yangtze River on a reed and meditated continuously for nine years (losing his arms and legs in the process). Daruma embodies resoluteness, perseverance and resilience. Many of the tenets of Zen Buddhism (separating illusion from reality, nonattachment to emotions and ideas, self-discipline and embracing impermanence) are also key to successful investing, and many of the qualities Daruma is best known for are those that Daruma seeks to emulate every day. Check out their monthly newsletters.
