We confess to being more than a little obsessed with debt. In his book The Origin of Financial Crises (2008) our Chief Investment Officer, George Cooper, explains why excessive debt is making our financial system increasingly crisis-prone. In Debtonator (2015) our Chief Executive, Andrew McNally, describes how companies mainly financed by equity perform better.
Our views on the dangers of debt permeate our approach to investment, from asset selection through portfolio construction and into risk management. At every stage we seek to enhance investment resilience through a fuller understanding of financial leverage. By avoiding companies most exposed to financial instability, and investing in companies best able to profit from the opportunities such instability presents, we always look to build wealth from a position of financial strength.
Increasing leverage might appeal in theory but in practice it severely distorts markets. It is these distortions that Equitile looks to exploit.