Contact Us
Font Size: A A A


Wasatch way

Our Passion

“The Wasatch Way” of investing is more than just a process or a person. It combines our passions, principles, people, and processes in uniquely collaborative investment strategies designed for long-term investors. Learn more about the factors that make up the Wasatch philosophy:

We are passionate and disciplined about extraordinarily deep due diligence and collaboration in search of superior long-term investments.

In this section:

Deep due diligence

Extraordinarily deep due diligence means we know our investments inside and out. We want to make sure that our standard of quality and integrity exists at all levels in the companies we own. We begin by thoroughly studying each company and its specific industry. We dig deeper, researching and interviewing the company’s suppliers, competitors and customers. We travel to company headquarters to gain first-hand experience with management, and we often tour facilities and inspect products to see their business strategy in action.

This level of due diligence is repeated each time we explore a potential investment.  We visit over 800 companies a year, and to do so we have one of the highest ratios of research analysts to assets under management in the industry. Our thorough process allows us to gain long-term insight into a company, its business model, and its investment potential.

JB TAYLOR, CEO, Portfolio Manager
When I was researching Rent-A-Center, which operates a chain of rent-to-own stores, I visited the company’s headquarters and retail outlets on multiple occasions.  However, since payment collections are a critical element of the business model I also wanted to test first-hand the quality of its collection efforts.  I rented a large-screen TV and deliberately became a delinquent customer to see how aggressively the company would pursue my overdue payment. I was pleased with their response as store representatives promptly followed up with a series of friendly phone calls until I asked them to pick up the TV, which they immediately did.  This added to my confidence in the company's business model.

Cross-team collaboration

An essential element of knowing our investments is gaining perspective from multiple viewpoints.  We have hundreds of years of combined investing experience within the Wasatch research team, and we believe it is through our ability to tap into that experience via cross-team collaboration that our investment process becomes uniquely powerful.  We call it multiple eyes™. It’s a “What are we missing?” approach, where team members discuss investments with analysts across multiple teams to gain insight and capitalize on collective experience, before making their investment decisions.

Our multiple eyes approach to investing calls for various members of our investment team to contribute to the analysis of each company we purchase. That’s why the ability to communicate about investment ideas—and take lessons from others’ experience—is crucial.

One critical characteristic shared by all of our investment professionals is the willingness to learn—a trait that requires a certain degree of humility. Early on in our history, I had to let a talented analyst go because he simply couldn’t admit that he had made an investment mistake. The way I saw it, his inability to acknowledge and discuss that error prevented all of us from learning from the experience.

At Wasatch we expect our professionals to dig deep in forming investment theses, seek collaborative perspective from across the team, and then make disciplined decisions clear of the occasional frenzy that strikes the investment community.

Disciplined approach

We believe strongly that we have an advantage in finding superior investments because of our commitment to deep due diligence and cross-team collaboration.  This passion gives us the conviction to remain unwavering in our discipline regardless of market cycles and fads.  Such cycles will not always be in our favor, but we expect to deliver solid performance over the long-term.

JB Taylor, CEO, Portfolio Manager
The dot-com run-up was perhaps the biggest test of our discipline.  Our performance significantly lagged our peers as dot-com valuations climbed rapidly.  We had made very few investments in these companies because we simply couldn’t make their business models translate into real earnings that would make these companies worthy of their valuations.  We questioned and re-questioned ourselves during this period as dot-com company stock prices soared, but we stayed true to the discipline of our investment philosophy.  While our relative performance took a big hit over the short-term, we more than made up for it when the bubble burst—and ended up looking like heroes over the long-term.

Long-term view

When it comes to performance, our goal is to beat the index benchmark over the long-term. We want clients to have confidence that when they return to an investment after 10 years, they will find good, solid returns.  We don’t expect to be the best performing fund out there, but we hope to be consistently above average over the long-term.

Eric Bergeson, Founder
Benchmarks like the Russell 2000 and S&P 500 indexes can be useful gauges of investment performance but we feel that short time periods such as one quarter or one year are not meaningful indicators of how a portfolio will perform over the long-term. This is important because all the Wasatch Equity portfolios are intended to be long-term investments.  We believe comparing the performance of our portfolios to their benchmark indexes over five and 10 years provides a much more accurate assessment of investment performance.