About Us

Munro is an independent global absolute return equity manager with a core focus on growth equities. Through its proprietary investment process, worldwide network and unique knowledge base, Munro Partners seeks to invest in and benefit from some of the key structural changes that occur in our world today.

Its portfolio managers give investors access to institutional quality and look to invest their clients’ money as they would invest their own. They focus on generating meaningful absolute annualized returns for investors through the investment cycle, while maintaining a capital preservation mindset.

Our Funds

Munro is an active manager focused on delivering absolute returns.

Our Team

Munro Partners are a team of like-minded individuals with previous working relationships that have come together to build, own and operate a successful global equities fund manager. The investment team is led by Chief Investment Officer, Nick Griffin, with a 12-year proven track record of strong absolute returns and outperformance over multiple market cycles.

Nick Griffin

Founding Partner, Chief Investment Officer

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Ronald Calvert

Founding Partner and Chief Executive Officer

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Jonathan Spensley

Founding Partner and Chief Operating Officer

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James Tsinidis

Portfolio Manager

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Jeremy Gibson

Portfolio Manager

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Kieran Moore

Portfolio Manager

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Sam Shields

Operations Manager

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Bianca Mercury

Executive Assistant

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Our Philosophy

Investment approach

Absolute returns

Munro only runs absolute return funds. Its portfolio managers follow an index-agnostic strategy that aims for meaningful absolute returns through the investment cycle, with a focus on preserving capital. Munro’s flexible investment mandate allows its managers to dynamically manage market and currency exposure to protect clients’ capital and enhance long-term returns.

Active research

At Munro, investing is a process of covering the globe and continuously meeting with management teams. With an ‘on the ground presence,’ Munro’s founding partners built a strong 12-year performance track record on the back of averaging 400 company meetings a year, assembling a focused 1,000-stock universe, and owning a network of over 3,000 key contacts.

Growth investors

The portfolio managers at Munro are growth investors. Of the 20,000 listed corporations in the world, many profess to be growing, but only a small portion actually grow independently of the broader economic cycle. This is where the Munro investment process focuses. Its research process has been designed and honed over 12 years to successfully sift through the world’s listed corporations to find sustainable growth trends that are underappreciated and mispriced by the market.

Disciplined process

Munro runs a comprehensive and disciplined investment process that seeks earnings upside/downside visibility, valuation multiple upside/downside and catalyst visibility. In addition, the portfolios are managed within clear risk parameters and a disciplined drawdown management framework.

Stock picker

The investment process generates a high-hit rate of performing ideas and allows them to be appropriately sized and monetized over long periods. Concentration on stock and sector is important, while risk management and rigorously eliminating underperforming positions is crucial in generating strong absolute returns and outperformance over multiple market cycles.

Investment process

Idea generation

Munro identifies sustainable growth trends that are underappreciated, misunderstood and mispriced by the market. With in-depth industry expertise, Munro leverages its global access and prides itself in recognizing key “areas of interest” (AoIs), as well as second and third derivative trends often over looked by the markets. Its proprietary research process quickly identifies key winners and losers, and quantifies upside and downside, while giving time to price target.

The philosophy is based on three overriding principals:

1. Earnings growth drives stock prices

Companies that consistently earn more than the year before are generally rewarded with higher stock prices over time.

2. Sustained earnings growth is worth more than cyclical earnings growth

Consistent growth, independent of cyclical factors and above the peer group, is generally valued at higher multiples than otherwise.

3. The market will often misprice growth and its sustainability

Consensus earnings estimates often underestimate growth, and pegging to market multiples will often underestimate the sustainability and cash generation capacity of that growth. This allows for opportunities to invest in stocks well below their intrinsic value.

Idea generation process

Ideas are generated from a combination of top-down thematic and bottom-up views. The team identifies medium to long-term structural themes and the resulting investment trends, and distinguishes between trends that are well understood and priced in by the market, as well as those that are underappreciated and overlooked (AoIs).  

The research process is a vital ingredient. Constant interaction with corporate management, independent consultants, industry networks, sell-side research and the private equity community all contribute to identifying new AoIs and new investment opportunities. 

Munro maintains a generalist research approach across all sectors and markets, with the flexibility to focus resources on areas of greatest opportunity. Analysts act as stock and AoI ‘champions’ when contributing to portfolio construction. 

The team has amassed a deep internal stock knowledge database of over 800 stocks, and actively mines this universe for fundamentally driven investment opportunities. 


Idea evaluation

Qualitative factors

Qualitative tests: Munro looks for five key company characteristics to gauge whether a listed company is likely to benefit or lose from a particular growth trend and whether that will be sustained over an extended period of time.

GROWTHExhibit faster earnings; EBITDA or revenue growth versus peers and growing total addressable market (TAM)
ECONOMIC LEVERAGEExhibit pricing power or economic leverage to improve margins
SUSTAINABILITYExhibit ability to sustain growth due to scale, position, intellectual property and/or locational advantages
CONTROLExhibit strong management ownership and incentives
CUSTOMER PERCEPTIONExhibit strong customer reviews and rapid adoption

Quantitative factors

Quantitative testsMunro uses three valuation-based tests to quantify earnings upside/downside, multiple upside/downside and time-based catalysts. Ideas graduate from the universe to the portfolio based on the relative upside generated from these tests.

EARNINGS UPSIDE/DOWNSIDEBuild in-house valuation model, and bull and bear-case scenarios
MULTIPLE UPSIDE/DOWNSIDECorporate characteristics score to determine appropriate earnings multiple and price target
CATALYSTSMap catalyst calendar, and timing and magnitude of re-ratings
  

Portfolio construction

Qualitative and quantitative tests combine to build a high-conviction, index, region and sector-agnostic portfolio where capital preservation is driven by a top-down view of market risks and hedging possibilities.

EXPOSURE MANAGEMENT
  • Driven by bottom-up idea generation
  • Typical gross exposure between 50-150% and typical net exposure between 50-100%
  • Exchange traded option positions frequently used to protect downside
PORTFOLIO CONCENTRATION
  • Typically 30-50 high conviction positions
POSITION SIZING
  • Average longs of 3% and average shorts of 1.5%
SHORT PHILOSOPHY
  • Shorts are independent alpha single stock shorts; they are not used as a portfolio hedging tool
  • Shorts are typical represented by secular losers or misplaced securities and are subject to a more prudent risk-taking approach
AGGREGATE PORTFOLIO RISK
  • AlphaDesk Portfolio Management System used to provide real time reporting and pre/post trade compliance
  • The investment team actively measures portfolio correlations, sector risks, style exposure and aggregate valuation metrics which is formally reviewed weekly

Risk management

Risk management and capital preservation are integral parts of Munro’s investment philosophy and portfolio management.

EXPOSURES
  • Maximum gross exposure limit of 200%
  • Maximum net exposure limit of 100%
SINGLE POSITIONS
  • Maximum long position of 10% of NAV at cost
  • Maximum short position of 5% of NAV at cost
CONCENTRATION
  • No sector or market concentration limits. In practice, Areas of Interest create differing sector exposures
LIQUIDITY
  • 80% of individual position sizes are limited to 30% of 10 days average daily volume (trailing 90 days)
STOP LOSS
  • Individual stock stop loss formal review at 20% drawdown, 10% for shorts
  • Gross exposure formal review at 3% drawdown. Net exposure formal review at 5% drawdown
CURRENCY
  • Manage for base currency benefit, with a bias to hedge back to base currency