Objectivity is the key to selling stocks successfully.

Cambiar understands that a rigorous sell process is just as important as the initial buy discipline. Once a stock approaches our target price, we will most likely begin to trim the position to reflect that the valuation disconnect identified at purchase has largely been rectified by the market.  While we may continue to hold the position if we remain positive about the ongoing fundamentals, we recognize that the more prudent course of action is to reallocate capital into companies that we believe to offer a more compelling risk-reward tradeoff. 

In an attempt to mitigate stock-specific risk, we will also trim a holding if it becomes an outsized position within the portfolio.

Stocks may also be sold if we recognize a decline in fundamentals, if the anticipated catalyst fails to materialize, or if a more attractive investment opportunity exists. 

Cambiar also employs a review process for any holding that incurs a material price decline from original purchase or relative to the overall market.  At that time, the sponsoring analyst is responsible for presenting a comprehensive review of the position.    If it is agreed that the original purchase thesis remains intact, the decision may be made to add to the position; however, this add will only occur once.

We believe that a consistent implementation of our sell discipline has enabled us to capture gains in those stocks that have been profitable, as well as limiting capital loss in situations where there is a deterioration in the fundamentals that supported the initial investment decision.