Investment Strategy
Passport Capital invests in businesses approaching inflection points that result from growing demand and strong market positioning. Passport has combined macro-economic and sector analysis to identify opportunities resulting from the long term expansion of leading emerging economies, select natural resource scarcity, and the power of networks, brands, and intellectual property common to the technology, consumer, and service sectors. Investments primarily emphasize public equity securities. Passport also makes highly targeted investments in equity derivatives, select private companies, and swap contracts.
Passport Capital seeks to achieve high compounding risk-adjusted returns in each of its investment strategies. While Passport employs various hedging strategies, we believe our best risk management tool is rigorous research, including consultation with industry, legal and regulatory advisers.
Global Strategy
The global strategy is a long-biased, value-oriented strategy seeking significant inefficiencies in the world’s most promising capital markets. The global portfolio is diversified, drawing on the research of Passport’s sector teams and international reach. Because the strategy seeks very high long-term, risk adjusted returns, the portfolio includes investments in a wide array of geographies, industries and capitalizations. The portfolio’s short positions typically derive from our identification of structurally over-invested industries and from risk management considerations.
Long Short Strategy
The Long/Short Strategy seeks to deliver attractive risk-adjusted returns over the long-term through a portfolio of liquid investments. With the increased incidence and importance of government intervention in markets, through both stimulus and dynamic and changing regulatory policies, the Long/Short strategy places a premium on holding “liquid” assets, favoring agility over expected return if the cost is liquidity. Diversified across geographies, industries, and capitalizations, the Long/Short Strategy draws upon the independent fundamental research of the firm’s sector teams and extensive international reach.
Materials Strategy
The materials strategy invests in public and private companies with a focus on the basic materials sector. The public equity investments typically emphasize small cap metals and mining companies. The private equity investments generally include companies that are in the later stages of development.
Energy Strategy
The energy strategy is a long-biased strategy investing in targeted sectors within the global energy industry, including oil service, exploration and production and alternative energy. In our opinion, valuations do not reflect the scarcity of both energy resources and services required to access them. Certain sectors/stocks provide superior risk/return characteristics, based on contracts, sales growth, unrecognized potential reserves and information arbitrage.
Special Opportunities Strategy
The special opportunities strategy seeks to earn superior long-term returns through a concentrated portfolio of public and private investments. The strategy leverages Passport’s global research, relationships, deal flow, and oversight capacity. A longer targeted investment duration enables a high degree of concentration and allows for substantial investments in less liquid public and private equities.
Basic Materials All Cap
The materials strategy invests in public and private companies with a focus on the basic materials sector. The public equity investments typically emphasize small cap metals and mining companies. The private equity investments generally include companies that are in the later stages of development.