Who we are

Castle Investment Management was founded in 2010 and is located in Alexandria, Virginia. The firm is managed by its two founders — Caeli Andrews and Andrew Welle.

What we do

Everything we do is built around our long-term perspective on investing. Our sub-advisers have established institutional track records, and we bring their strategies to investment professionals through Castle mutual funds. Each of our investment teams follow an understandable, repeatable investment process. Our sub-advisers must have the fortitude to stick to their investment process regardless of the market environment. We recognize that having this discipline can require a great deal of patience. We prefer sub-advisers who focus on delivering risk metrics lower than the broad market (metrics such as down capture, beta, and standard deviation). We place little emphasis on short-term performance and judge the results of our sub-advisers over a full market cycle. Castle is responsible for the selection and ongoing monitoring of each Fund’s sub-adviser, including the adherence to the fund’s investment objective, style integrity, return objective and risk parameters.

Who we work with

We build long-term relationships with like-minded investment professionals and deliver our specialized investment strategies to their clients through the Castle family of mutual funds.

Attributes of our sub-advisers

The sub-advisers we select must have the following attributes: Curiosity, Patience, and Fortitude.

Curiosity is necessary to understand the fundamentals of a business, as well as the risks and rewards of an investment.

Patience. We believe the price paid for an investment is a key determinant of total return. Investments made at too rich a price leave little margin for error. We select sub-advisers who allocate shareholder capital only when investment opportunities can be made at a discount to their conservative estimate of fair value.

Fortitude. Finally, our sub-advisers must be willing to go it alone, diverge from the crowd, and stick to their investment process regardless of the market environment.

How These Traits Influence Our Funds

Curiosity

Our Sub-Advisers:

  • Employ bottom-up fundamental investment processes grounded in independent research that results in a deep understanding of potential investments.
  • Look further out in their research and ask “what will drive this company’s earnings for several years?”  If they are not confident in the answer, they don’t invest.

Patience

Our Sub-Advisers:

  • Practice patience by first assessing the risks of an investment before assessing the potential return.
  • Wait to make purchases when a stock trades at a significant discount to their conservative estimate of fair value.
  • Make long-term investments in companies that are executing on solid business models and are excellent allocators of shareholder capital.

Fortitude

Our Sub-Advisers:

  • Diverge from the crowd and run focused portfolios of their best ideas.  This results in a low correlation to their benchmark and their peers.
  • Focus on returns over a full-market cycle and largely ignore short-term relative returns. They strive to limit the effects of market downdrafts.
  • Add to their cash positions when valuations are rich and deploy cash when valuations are low and the market is crowded with sellers.

Beta is a measure of a portfolio’s sensitivity to the market. Standard deviation measures an investment’s historic volatility. The down capture ratio is a statistical measures of a manager’s overall performance in downward moving markets.

We define a full-market cycle as a period of time, usually measured in years, that includes both ‘bearish’ markets (the market trends down) and ‘bullish’ markets (the market trends up).