December 14, 2023 — Learn about JAG’s history, investment philosophy, stock selection process, favorite investments, 2023 performance, and our 2024 Outlook…
TWST: For the benefit of readers, give us an introduction to JAG Capital Management. Mr. Conley: The roots of our firm go back all the way to 1945. We’ve been known as JAG Capital Management since 2013. We are a boutique registered investment advisory firm that manages investment portfolios for institutions, financial intermediaries, and individuals and families around the country. We’re a long-only manager and we actively manage growth equities and intermediate fixed income strategies for those three types of clients. We’re based in St. Louis, Missouri.
TWST: What is most important to know about your investment philosophy overall? Mr. Conley: I’m the third CEO of the firm since the roots back in 1945, and our investment philosophy is largely due to our long history serving the investment needs of women’s religious institutions. Many religious orders established their presence in the United States in the 19th Century, and almost all of them had very humble beginnings. But then as we got into the mid to latter part of the 20th century, a small but growing number of religious communities had accumulated meaningful amounts of long-term assets. JAG’s founder realized that these clients really had two primary goals with their financial assets. One, they needed to generate some dependable cash flows to help support their missions. Secondly, they wanted to compound their assets over time, to support the very long-term growth of their missions. Those twin goals form the bedrock of our firmwide investment philosophy. On the equity side, we’re growth investors. We’re trying to build and maintain a focused portfolio of leading companies that are going to grow faster than their peers and the broader market, and ultimately, compound their value over time. And the fixed income side is designed to do what fixed income is supposed to do: provide a lower volatility stream of reliable cash flows.
To use a baseball analogy, we manage our bond portfolios to hit singles and doubles rather than home runs or grand slams. Our approach to bonds is unapologetically old-fashioned and intentionally boring. When fixed income is exciting, that’s usually not in a good way. Some fixed income strategies were very exciting in 2022, especially those that were heavily positioned in long duration bonds. That’s not for us.