Approach
Discover and Profit from World-Class
Chinese Companies
We believe in the fundamental principles of Benjamin Graham's value investing philosophy. A value investor thinks like a business owner, requires a large margin of safety before investing, and profits from the emotionality of markets. In China's markets, where short-term, emotionally driven retail investors account for the majority of trading volume, numerous opportunities exist for rational, long-term investors.
Strategy
We capitalize on these opportunities by purchasing world-class Chinese companies when they are undervalued, while hedging our portfolio by shorting overvalued companies with weak fundamentals and negative catalysts on the horizon.
This strategy focuses on China-centric equities across Mainland China, Hong Kong, and global listings, utilizing both long-only and long/short strategies. Our approach combines rigorous, bottom-up, private equity-style due diligence with primary research and leverages our extensive network throughout China. Additionally, we employ data-driven insights from our proprietary databases, models, and algorithms to effectively identify winners and losers.
We hold a concentrated portfolio of companies characterized by solid cash flows, attractive growth prospects, high barriers to entry, exceptional management, ownership alignment, global competitiveness, and low absolute valuations. When appropriate, we help our portfolio companies unlock their potential through strategic introductions, alliance building, and top-tier executive recruitment. As part of risk management, we hedge our portfolio with short positions in companies with poor fundamentals and imminent negative catalysts.
Our disciplined long-term focus, combined with the ability to act decisively when opportunities or risks emerge, positions us to capture alpha and deliver enduring value for our clients through all market cycles.
Process
IDEA
GENERATION
Automated financial analysis of all 5000+ Chinese stocks
Quantitative exploration
of qualitative ideas
Active monitoring of macroeconomic and industry news
STOCK
SELECTION
Thesis developed in concert with portfolio manager
Private equity-style fundamental research
Scenario analysis, trading strategy, and contingency planning
PORTFOLIO
CONSTRUCTION
Integration of macro research and market analysis
Conviction-based position weighting
Diversification across sectors with industry concentration monitoring
RISK
MANAGEMENT
Thorough research to manage individual stock risk
Robust risk controls to ensure alignment with portfolio guidelines
Strong emphasis on margin of safety
EXIT
STRATEGIES
Changes in risk-reward profile or expected value
Realization of expected catalysts
Investment idea not playing out as forecast
Funds
Banyan China Select
Banyan Offshore Select
Banyan C10
Long/Short strategy aiming for compellling returns with low volatility focused on the Chinese A-Shares universe
Long/Short fund aiming for compelling returns with low volatility focused on China-centric companies listed in Hong Kong, US and other stock exchanges globally
Concentrated long-only strategy investing in our highest conviction ideas in the Chinese A-Shares universe
Solutions
At Banyan Partners, we provide custom investment solutions tailored to meet the unique needs of our investors. Our offerings include separately managed accounts with bespoke management and strategic partnerships that harness collaborative synergies.
With deep expertise in Mainland China and China-centric equities worldwide, we ensure seamless and reliable access to the full investment universe, driving meaningful value for our clients.
For more information, please feel free to contact us.