Christopher J. Guptill, Broadmark’s late founder and former CIO, always believed macro and equity market risk could and should be addressed. In the late 1980s, he developed a tactical investment process that has been able to side step major market downturns and participate, to varying degrees, in market advancements. Addressing risk requires us to be tactical and therefore our process is a rejection of traditional buy and hold investing. The models we use and the information we evaluate is critical to our decision making, but our experience adhering to a disciplined, time-tested process is, in our opinion, our best feature. Not every decision we make will be right, but rest assured every decision will be made understanding that there is real risk in the equity markets and those risks must be considered carefully.
We are extremely transparent and believe we offer a unique approach to Long/Short equity investing. We can and will be long and short at the same time, but most often our exposure is directional, i.e., we are more likely to be long and hold cash as a way to be hedged. Also, we have a proven history of being successful during bear markets by being net short. We do not buy individual securities, we invest in large, liquid index-based futures and exchange traded funds. These instruments give us the ability to address macro risk in a rapid fashion when necessary.
This tactical approach to investing is not new to us, our CIO Richard Damico and investment team have followed this disciplined process for many years. We are able to quickly reposition portfolios due to our choice to use very liquid instruments such as index-based futures and ETFs. Broadmark Asset Management LLC serves as the advisor for several investment vehicles that follow this tactical process.