The investment objective of Elizabeth Park Capital Management, the flagship master fund, is to achieve superior risk adjusted returns annually, while preserving capital in down markets. Our goal is to target 12-15% net of fee annualized returns over the credit cycle.
We employ a fundamental, bottom-up, stock-picking process focused on small/mid cap banks and thrifts (all but the top ten banks in the country). The Fund also invests in preferred stocks (straight, trust and convertibles) and select mortgage REITs. The Fund mitigates risk by utilizing short positions, which we view as fundamental in nature and as a profit center.
We determine the relative value of securities by analyzing several qualitative and quantitative attributes, including business mix, capital, asset quality, management, and liquidity. Our valuation methodology focuses on price to tangle book value and price to normalized EPS.