High Quality Small Cap

Managed by Capstone Global Investments

-3.6% Last 30 days -0.2% Last 90 days -12.1% Last 365 days -0.76 Sharpe Ratio -32.6% Max Drawdown

High Quality Small Cap

Managed by Capstone Global Investments

-3.6% Last 30 days -0.2% Last 90 days -12.1% Last 365 days -0.76 Sharpe Ratio -32.60 Max Drawdown
Risk score
Strategy Stocks
AUM fee 1.00%
• Investment minimum: 30000.0
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The High-Quality Small Cap strategy is a fundamental core approach that invests in small cap companies in strong financial condition and whose equities are priced below our view of fair value. Our research process integrates fundamental research with quantitative screening to exploit market anomalies, providing us a competitive advantage in identifying investment opportunities. Our bottom-up proprietary research work focuses on identifying high-potential investment candidates experiencing positive fundamental change.


Our investment philosophy is founded on the principle that first-hand fundamental research is essential to make sound, long-term investment decisions. We place great emphasis on the research component of our investment process. The research process begins with an analysis of the company's financial statements. In terms of the balance sheet, we prefer low debt and high Return On Equity. In terms of the income statement, Capstone looks for earnings that are high and stable. We also consistently review regulatory filings, press releases, and industry data. We review the portfolio holdings, new ideas screens, and industry and sector trends on a weekly basis.


We believe that markets are not completely efficient and recognize that market participants are averse to risk and change. Through a stock selection process that is focused on the early identification of changes in fundamentals, and active portfolio management that embraces intentional risk taking while minimizing unnecessary systematic biases, we seek to consistently benefit from persistent market anomalies and inefficiencies.

Allocation discipline

First and foremost, our portfolio construction discipline is grounded in bottom-up stock selection as the key driver of results and avoiding unintended systematic biases. We believe stock selection is a competitive advantage and where we add value. We review various sources of risks in the portfolio on an ongoing basis. Our risk management approach includes understanding stock-specific risks (industry environment, management quality), systematic risks (economic cycle, interest rate cycle) and concentration risks (such as sector weights, industry concentration, and position sizing). Portfolio positioning primarily reflects our views on individual companies, rather than reflecting a defined top-down macroeconomic forecast. Sector overweights and underweights are driven primarily by bottom-up stock selection decisions rather than broader top-down or thematic drivers. The portfolio is relatively focused with approximately 35 to 45 companies. The individual holdings are diversified across economic sectors; however, the portfolio sector weights may vary widely from that of the benchmark.

Sell discipline

A portfolio holding will be sold or trimmed for one of four reasons:
(1) Relative valuation – for example, a stock becomes significantly overvalued relative to its peers
(2) Deteriorating business fundamentals – for example, negative sales or earnings growth, margin contraction, loss of market share, etc.
(3) A superior investment idea relative to a current holding is found
(4) Portfolio construction/risk control – for example, a stock becomes too large a position in the portfolio.

All performance information on this page is based on the performance of the Portfolio Manager’s account. Client performance may differ. This information was calculated on May 20, 2019.

Daily returns
Russell 2000 ETF
S&P 500 ETF
Manager (net of fees)
Last 30 days -3.6% -2.1% -2.5%
Last 90 days -0.2% 2.6% -2.9%
Last 365 Days -12.1% 6.7% -5.1%
Since inception (Annualized) -5.4% 10.9% 6.0%
2019 (YTD) 17.7% 14.1% 13.7%
2018 -26.3% -4.6% -11.1%
2017 6.8% 21.7% 14.6%
2016 31.1% 12.0% 21.6%
Risk metrics (last 365 days)
Russell 2000 ETF
S&P 500 ETF
Manager (net of fees)
Volatility 19.1% 15.2% 17.9%
Sharpe Ratio -0.76 0.28 -0.42
Sortino Ratio -1.03 0.35 -0.56
Maximum Drawdown -32.6% -19.4% -26.8%
Value-at-risk (95%, 1 week) -4.4% -3.5% -4.1%
Additional metrics (last 365 days)
vs. Russell 2000 ETF
vs. S&P 500 ETF
Information Ratio -1.8% -1.0%
Alpha -19.14 -7.53
Beta 1.05 0.99
R-Squared 0.7% 0.9%
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About Capstone Global Investments

Capstone Global Investments is an investment boutique located in Atlanta. The firm is independently owned and controlled by our partners and associated with privately held Atlantic Investment Company. The Capstone strategy seeks to generate absolute returns over the long term in the attractive asset class of smaller under-researched companies by building portfolios that have lower than market levels of debt, higher than market levels of profitability, and are trading at a discount to their intrinsic value.

Important Information

  1. Past performance is no guarantee of future results, and all investments, including those in this portfolio, involve the risk of loss, including loss of principal and a reduction in earnings.
  2. All performance information on this page is based on the performance of the Portfolio Manager’s account, using the manager’s own funds. Portfolio Manager’s pre-Interactive Advisors performance information may include performance of non-Interactive Advisors client accounts. Performance of the Portfolio Manager's account is calculated by Interactive Advisors on a daily time-weighted basis, including cash, dividends and earnings distributions and reflects the deduction of broker commissions. Manager returns include trades and positions that fail Interactive Advisors' trading rules, as a result, actual client returns will differ. Interactive Advisors advisory fees are simulated and applied retroactively to present the portfolio return "net-of-fees".
  3. None of the performance information displayed on this page is based on the actual performance of any Interactive Advisors client account investing in this portfolio. The performance in an Interactive Advisors client account invested in this portfolio may differ (i.e., be lower or higher) from the Portfolio Manager’s account performance based on any trading restrictions imposed by the client (resulting in different account holdings), time of initial investment, amount of investment, frequency and size of cash flows in and out of the client account, applicable brokerage commissions, and different corporate actions.Clients investing in this portfolio may view the actual performance of their investment in this portfolio by logging into their Interactive Advisors account and reviewing their customized dashboard.
  4. All graph data is as of the end of day for the referenced period, unless otherwise specified. The investment minimum is the minimum investment required to follow a particular portfolio. The minimum amount is determined by Interactive Advisors, based on the characteristics of the underlying portfolio. It should not be considered as specific investment advice for your investment situation.
  5. The performance charts are provided for informational purposes only, and should not be used as the basis for making an investment decision. We rely on mathematical formulas, computer programs, and pricing information from third-party vendors to provide these returns. Neither Interactive Advisors nor any of its data or content providers shall be liable for any errors in this information or any actions taken by you in reliance upon this information.
  6. Benchmark returns displayed have been calculated by Interactive Advisors using daily adjusted close prices and include dividend income. More information here. For certain portfolios Interactive Advisors uses an index as a benchmark, while for others it uses an investable exchange traded fund (ETF) as a benchmark. Index returns do not reflect the deduction of any management fees, transaction costs or expenses. Individuals cannot invest directly in an index. Investable ETF returns reflect the deduction of (i.e., are net of) management fees, transaction costs and expenses.
  7. All Portfolio Manager information including personal data, profiles, strategies, monthly investment reports, and historical results outside of Interactive Advisors has been provided by the Portfolio Manager. Interactive Advisors makes no representation or warranty of its accuracy, completeness or relevance and it does not represent the opinions of Interactive Advisors. Transaction history of Portfolio Managers is available upon request. Portfolio classifications are provided by Interactive Advisors, and are intended to serve as a general guide.
  8. Not all transactions listed will appear in accounts due to Interactive Advisors' trading rules and individual client constraints. Eligibility of these securities is monitored periodically, and may change over time. Actual client investment holdings may vary.
  9. This portfolio was launched on Interactive Advisors on May 11, 2017.