Investment Approach

HighWay™ Investment Process

High Street applies a valuation-based, fundamental approach across the fund range. Our team of dynamic investment professionals conduct deep research to produce insights that drive proven internal valuation models.

Philosophy

Our approach is grounded in the view that long-term performance is driven by cash generation. Shares compounding excess cash flows at a superior rate for extended periods outperform. These opportunities typically exhibit strong fundamentals backed by durable competitive advantages which we analyse using a combination of quantitative and qualitative techniques.

Over shorter periods, share prices can deviate significantly from their fundamental trajectory. Sentiment, growing passive ownership, speculation and liquidity needs are often the drivers of mispricing. Applying a uniform valuation methodology can identify strong companies trading at discounted levels set to revert to their long-term trend.

Process

HighWayTM is our semi-automated, investment process enabling a repeatable decision-making framework at scale. Clearly defined parameters ensure consistency and minimise behavioural biases.

A broad investment universe is systematically refined to a subset of high-potential businesses. Inclusion is dependent on numerical metrics revealing financial and competitive standing, company outlook and the ability to produce shareholder value through compounding future cash flows.

Successful candidates are subject to deep qualitative analysis centred on examining their sustainable competitive advantage. Our team studies the investment case and presents it to the Investment Committee. Constructive debate ensues until forecasts are refined to the point where probabilities can be assigned to several outlook scenarios.

These scenarios serve as the inputs that inform our valuation models. As the backbone of our approach, they ensure application of a uniform methodology that clearly attributes value to a handful of underlying drivers. This phase distinguishes great companies from attractive investment opportunities.

Valuation determines inclusion but risk management is central to portfolio construction. We define risk, in our role as fund manager, as the likelihood of an unexpected deterioration in cash flows, given that share prices ultimately follow fundamentals. To mitigate this, proprietary risk rankings and a clear framework determine appropriate market exposure.

Each step in our process is assessed for statistical significance and consistently refined. For investors, this translates into an approach that seeks to deliver long-term outperformance grounded in evidence and perseverence.